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The optimal pure proportional navigation (PPN) guidance law with time-varying navigation gains is considered. Unlike the conventional optimal PPN approach where linearized model was assumed in the optimization process, this work exploits the exact nonlinear formulation of PPN to derive analytically the optimal time trajectory of the navigation gain to minimize a performance index which is a weighted sum of the final time and the integral of the squared acceleration. It is verified that the PPN scheme with constant navigation gain is not only optimal in the vicinity of the interception point, but also optimal for the whole trajectory, if the navigation constant is designed by the methodology proposed here. Based on the optimization results for nonmaneuvering targets, a recursive optimal PPN scheme is proposed for maneuvering targets, wherein the optimal navigation gain and time-to-go are predicted recursively during the interception, and trajectory and performance of the interceptor guided by optimal recursive PPN scheme are evaluated analytically.