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This paper discusses GPRS network performance optimization with a dynamic simulator. Simulator models the GSM/GPRS system and a realistic cellular environment with accurate models of e.g. propagation environment, user mobility and traffic distribution. All the relevant details of GPRS protocol stack (LLC, RLC/MAC and physical layer) are taken into account, but less focus is put on GPRS core network, signaling and IP transport layer effects. After defining a set of key performance indicators (KPI) as the basis for the analysis, a real network configuration scenario was applied with the simulator. This setup was then used when GPRS network performance was investigated in order to find the maximum capacity for both GPRS and voice services. At the same time the effect of different radio resource management (RRM) algorithms and parameter alternatives were studied, together with the dynamic interaction between circuit and packet switched services. As a result of this study, a set of optimized and tuned parameters are suggested, which could help operators to go towards more aggressive network deployments with more advanced RRM schemes and at the same time provide higher quality of service (QoS) to the end users with maximized capacity.