The paper presents the dynamic compound wavelet method (dCWM) for modeling the time evolution of multiscale and/or multiphysics systems via an "active" coupling of different simulation methods applied at their characteristic spatial and temporal scales. Key to this "predictive" approach is the dynamic updating of information from the different methods in order to adaptively and accurately capture the temporal behavior of the modeled system with higher efficiency than the (nondynamic) "corrective" compound wavelet matrix method (CWM), upon which the proposed method is based. The system is simulated by a sequence of temporal increments where the CWM solution on each increment is used as the initial conditions for the next. The numerous advantages of the dCWM method such as increased accuracy and computational efficiency in addition to a less-constrained and a significantly better exploration of phase space are demonstrated through an application to a multiscale and multiphysics reaction-diffusion process in a one-dimensional system modeled using stochastic and deterministic methods addressing microscopic and macroscopic scales, respectively.