A method and apparatus for three-dimensional video encoding or decoding with conditionally constrained disparity vector are disclosed. In one embodiment, a derived DV (disparity vector) for the current texture block is determined and DV constraint is applied or is not applied to the derived DV to obtain a final derived DV. Inter-view predictive encoding or decoding is then applied to the input data utilizing at least one of selected coding tools, wherein a same final derived DV is used by all selected coding tools, and the selected coding tools comprise inter-view residual prediction, view synthesis prediction and inter-view motion parameter prediction.