An optimal guidance law for missiles with time-varying velocity is investigated. The closed-form solution is derived and properties of the key variables of the solution, such as a time-to-go-like function and the time-varying guidance gain, are studied. Implementation aspects related to the computations of time-to-go and the guidance gain also are considered. Simulation studies show that the performance of the proposed guidance law is superior to that of proportional navigation or augmented proportional navigation.