This paper evaluates the mechanism of nutrient removal in an oxidation ditch system using basic process stoichiometry and model simulation. Aeration intensity and the resulting dissolved oxygen concentration are identified as the main parameters defining the denitrification potential, and affecting the extent of nitrification/denitrification processes, mainly because no clear anoxic/aerobic zones can be established in the system. For wastewater characteristics and a wastewater scheme tested with model simulation using ASM2d, process efficiency is highly influenced by the dissolved oxygen concentration in a narrow range of 0.4-0.8 mg/L. Enhanced biological phosphorus removal is also affected through the level of nitrate recycle into the anaerobic reactor. Diurnal variations in the influent at a constant aeration regime result in insufficient aeration during peak loads followed by overaerated periods, and in this way, cause temporal instability in nutrient removal performance. With the aid of dynamic simulations, the dissolved oxygen set-point control provides better effluent quality and process stability in terms of nutrient removal.