Using the local-density approximation, calculating the Hellmann-Feynman forces, and applying the direct method, the phonon-dispersion relations of cubic austenite, trigonal R, orthorhombic and monoclinic martensitic phases of the NiTi intermetallic compound have been derived. In the austenite phase we have found a soft phonon branch with a minimum at the M reciprocal-lattice point. The orthorhombic structure, in turn, shows a shear low-frequency mode favoring a martensitic phase. The phonon-dispersion relations indicate that martensitic and R phases are dynamically stable. For the martensitic and R phases the phonon density of states, free energies, and heat capacities have been calculated. We find that the first-order R-phase-martensite phase transition temperature occurs at T c ϭ285 K.