Abstract. The labeling problem of dynamic XML documents has received increasing research attention. When XML documents are subject to insertions and deletions of nodes, it is important to design a labeling scheme that efficiently facilitates updates as well as processing of XML queries. This paper proposes a novel encoding scheme, vector encoding which is orthogonal to existing labeling schemes and can completely avoid re-labeling. Extensive experiments show that our vector encoding outperforms existing labeling schemes on both label updates and query processing especially in the case of skewed updates. Besides, it has the nice property of being conceptually easy to understand through its graphical representation.