Abstract: This paper studied a new kind of dynamic multistage facility layout problem under dynamic business environment, in which new machines may be added into, and old machines may be removed from the plant. A mathematical model and the batch arriving pattern were presented. By studying how to add/remove machines into/from the plant, two random events of adding/removing machines and three dispatching rules were provided. The corresponding simulation optimization algorithm under stochastic demand was presented. Finally, the effectiveness of the algorithm and simulation system was verified by realworld examples.