The generation mechanism of internal waves by tidal flow over Stellwagen Bank in Massachusetts Bay is qualitatively clarified. First, in order to demonstrate the continuous generation process of internal waves, a numerical simulation is carried out for the hydrographic condition during a field study by Chereskin (1983). The resulting internal waveforms agree well with the acoustic images obtained at several stages of the tidal flow. Next, the generation mechanism for these internal waves is analyzed via a physical interpretation of the calculated result. This analysis is made by use of characteristics which describe the propagation of the first‐ and second‐mode internal waves. It is shown that each mode internal wave with an upstream phase propagation is efficiently amplified while being carried downstream toward the location where the maximum tidal flow becomes critical: with the decrease of the tidal flow, the internal wave thus amplified begins to propagate upstream. In previous studies, these internal waves were interpreted as quasi‐steady lee waves. The present analysis, however, provides a satisfactory explanation for the time‐dependent features that are shown in numerical simulation. This indicates that the internal waves over the bank are transient waves formed in response to a time‐varying tidal flow, and not quasi‐stead