Distributed simulation is an enabling concept to support the networked interaction of models and real world elements that are geographically distributed. This technology has brought a new set of challenging problems to solve, such as Data Distribution Management (DDM). The aim of DDM is to limit and control the volume of the data exchanged during a distributed simulation, and reduce the processing requirements of the simulation hosts by relaying events and state information only to those applications that require them. In this thesis, we propose a new DDM scheme, which we refer to as dynamic grid-based DDM. A lightweight UNT-RTI has been developed and implemented to investigate the performance of our DDM scheme. Our results clearly indicate that our scheme is scalable and it significantly reduces both the number of multicast groups used, and the message overhead, when compared to previous grid-based allocation schemes using large-scale and real-world scenarios.