We present a 3-D physics-based high-resolution modeling approach to the dynamics of underwater ripples and dunes. The flow is modeled by large eddy simulation on a Cartesian grid with local refinements. The sediment transport is modeled by computing pickup, transport over the bed, transport in the water column, and deposition of rigid spherical particles in a Lagrangian framework. The morphological development of the bed is modeled by a sediment balance equation in which the pickup and deposition from the sediment motion submodels appear as source and sink terms. The model realistically replicated the formation and migration of dunes. Model results showed a good agreement with data from five flume experiments. We subsequently applied the model to investigate the effect of sediment grain size on ripples. Finer sediments were found to yield more superimposed ripples than coarser sediments. Moreover, under the same hydrodynamic conditions, the finer sediments yielded two-dimensional bed forms, whereas for coarser sediment irregularities increased. We extended the tests to pronounced 3-D morphologies by simulating the development of local scour at a pier. The results agreed well with experimental data. The model contributes to unraveling the complex problem of small-scale morphodynamics and may be used in a wide range of applications, for instance, to develop more reliable parameterizations of small-scale processes for application in large-scale morphodynamic models.