The disclosure includes a system and method for dynamic vehicle navigation with lane group identification. The system includes one or more processors configured to identify a plurality of roadway lanes on a plurality of roads, determine a plurality of lane groups in the plurality of roadway lanes based on traffic data indicating traffic on the plurality of roadway lanes, and estimate lane-group level traffic of the plurality of lane groups based on the traffic on the plurality of roadway lanes. The processors may further identify a client device location of a client device and a destination location, optimize a route between the client device location and the destination location using the plurality of roads and based on the lane-group level traffic of the plurality of lane groups, and provide route guidance to the client device based on the optimized route.