High Occupancy Toll (HOT) lanes are emerging as a solution to the underutilization of High Occupancy Vehicle (HOV) lanes and also a means to generate revenue for the State Departments of Transportation. This paper proposes a method to determine the toll price dynamically in response to the changes in traffic condition, and describes the procedures for estimating the essential parameters. Such parameters include expected delays, available capacity for toll-paying vehicles and distribution of travelers' value of time (VOT). The objective function of the proposed pricing strategy can be flexibly modified to minimize delay, maximize revenue or combinations of specified levels of delay and revenue. Real-world data from a 14-mile of freeway segment in the San Francisco Bay Area are used to demonstrate the applicability and feasibility of the proposed method, and findings and implications from this case study are discussed.