Within the EU-IP project DAMOCLES the variational data assimilation system NAOSIMDAS has been developed around the coupled sea ice-ocean model NAOSIM. The system has been applied successfully for initial state estimation in the _Sea Ice Outlook 2009_ for seasonal forecasting and for multi-year state estimation in the IPY years 2006 to 2008. Assimilated observations encompass (i) hydrographic data from Ice Tethered Platform profilers which have been deployed as part of several IPY initiatives_ covering part of the central Arctic Ocean (ii) hydrographic data from ARGO profilers provided by the CORIOLIS data center m ostly covering the Nordic Seas and the northern North Atlantic Ocean (ii) daily mean ice concentration data from EUMETSAT Ocean and Sea Ice SAF_ based on multi-sensor SSM/I analysis_ with a spacial resolution of 10 km (iv) two-day mean ice displacement data from passive microwave (SSM/I_ AMSR-E) or scatterometer (e.g. ASCAT) signals provide by EUMETSAT Ocean and Sea Ice SAF with a spatial resolution of 62.5 km.