In nowadays power networks, transmission companies are faced with a drastic growth in the electrical energy demand. As a result, further utilization of existing transmission lines capacity is very essential. Dynamic thermal rating (DTR), which is based on the actual weather and pre-load conditions, has a potential to offer a significant increase in a given transmission line capacity. Two types of DTR calculation methods, namely on-line monitoring of line temperature and weather-based rating, are discussed in this paper. The first method is the main contribution of this work and the second one is only reviewed. In the first method, phasor measurement units (PMUs) data are used for estimation of transmission line parameters and its temperature. In this method, a non-linear weighted least-square (NWLS) based algorithm is adopted for the estimation process. The second method uses weather stations data such as wind speed, ambient air temperature, etc., for calculation of DTR. A typical transmission line is simulated in MATLAB Power System Toolbox to demonstrate the performance of the proposed method for on-line monitoring of line temperature.I.