The dynamic behavior of superconducting quantum interference devices (SQUIDs) operated in a flux-locked loop (FLL) is discussed using a simple mathematical description. It is shown that the slew rate of any FLL is limited by the linear flux range of the SQUID Phi(min) and the effective loop delay t(d) to approximately Phi(t.max) = Phi(min)/(4t(d)) if a one-pole integrator is used, This allows one to estimate the dynamic limits of both analog SQUIDs with flux modulation or direct read-out and digital SQUIDs with on-chip read-out. In addition to theoretical limits, practically achievable performance is presented using our latest direct-coupled FLL electronics as an example of state-of-the-art SQUID read-out. This electronics is designed for both low-critical temperature (low-T-c) and high-T-c SQUIDs It combines low, noise with high bandwidth and slew, rate. All functions are computer controlled using a LabVIEW((R)) program, An automatic bias voltage tuning circuit increases the system stability in case of large cryogenic temperature fluctuations. Furthermore, an ultra-low-noise current source is integrated into the FLL board which can be used to supply a coil system compensating the Earth's magnetic field of about 60 muT while producing only 17 fT/rootHz extra noise at 1 kHz and 41 fT/rootHz at 1 Hz, respectively. (C) 2001 Elsevier Science B.V. All rights reserved.