The Northwest Atlantic Regional Energetics Experiment (REX) will study the dynamics and energetics of the Gulf Stream and associated rings. Bottom‐moored inverted echo sounders with pressure gauges (IES/PGs) will collect in situ data which both complement and augment the GEOSAT altimeter measurements in the Northwest Atlantic. The primary objective of these data will be the intercomparison of satellite and IES/PG measured fluctuations in sea surface topography and mean ther‐mocline depth. However, more detailed and absolute intercom‐parisons of these data would be available if the IES/PG could be positioned in an inertial reference frame while the measurements were taken. This paper presents an error model for computing the accuracy of positioning with a bottom beacon of the IES/PG type. Equations for studying the use of acoustic range data for locating an IES/PG with respect to a ship's track are developed and presented. The ship's track is assumed to be located in inertial space to the 1‐ to 2‐m level by application of the GPS (Mohan, 1983, 1984). Effects of depth‐dependent acoustic speed are included. Although IES/PGs as presently deployed would have to be modified to function as the type of ranging device described in this paper, the representative parameter values that have been calculated for the Northwest Atlantic REX show that sub‐1‐meter accuracy in location determination can be expected. A crucial factor is the measurement pattern, and recommendations for optimal patterns are presented.