The formulation and the algorithm of solving an ocean model for the prediction and assimilation of the observed data which makes it possible to reconstruct the circulation in the deep-water parts of the sea and at a shallow water shelf, as well as to describe the large time–space variability in the surface level, are considered. The model uses a vertical hybrid σ–z coordinate system: the several upper tens of meters of the ocean are described in the σ-coordinate system and the rest of the water column is described in the z coordinates. Such hybridization extends the possibilities of models for reconstructing thermo-hydrodynamic processes in different sea basins and the World Ocean. The differential formulation of the model in the σ–z coordinate system is presented; the simplified records of several operators that are allowable in the case of a small thickness of the ocean σ-layer are described. The construction of a computational grid, approximation of the bottom topography on it, and discretization of equations and boundary conditions of the models are considered; an approach to describing the bottom friction at shallow waters is offered. The results of the comparative experiments in the z and σ–z coordinate models are analyzed.