This document proposes a family of Per-Hop Behaviors (PHBs) based on Dynamic Packet State (DPS) in the context of the differentiated service architecture. With these PHBs, distributed algorithms can be devised to implement services with flexibility, utilization, and assurance levels similar to those that can be provided with per-flow mechanisms. With Dynamic Packet State, each packet carries in its header, in addition to the PHB codepoint, some PHB-specific state. The state is initialized by the ingress node. Interior nodes process each incoming packet based on the state carried in the packet's header, updating both its internal state and the state in the packet's header before forwarding it to the next hop. By using DPS to coordinate actions of edge and interior nodes along the path traversed by a flow, distributed algorithms can be designed to approximate the behavior of a broad class of 'stateful' networks using networks in which interior nodes do not maintain per-flow state. We give examples of services that can be implemented by PHBs based on DPS. We also discuss several possible solutions for encoding Dynamic Packet State that have the minimum incompatibility with IPv4.