In light of advances in processor and networking technology, especially the emergence of network attached disks; the traditional client-server architecture of file systems has become sub-optimal for many computation/data intensive applications. In this paper, we introduce a revised architecture for file management employing network-attached storage: the dynamic file server environment (Dynamo). Dynamo introduces two main architectural innovations: (1) To provide high scalability, the clients mainly perform the file management functions cooperatively in the system. Furthermore, data is transferred directly to the client's cache from network-attached disks, thus avoiding copies from a disk to the server buffer and then over the network to the client. (2) Dynamo uses a cooperative cache management, which employs a decentralized lottery-based page re-placement strategy. We show via performance benchmarks run on the Dynamo system and simulation results how this architecture increases the system's adaptability, scalability and cost performance.