The focus of this study was to evaluate the impact of model-based inquiry on pre-service physics teachers' conceptual understanding of dynamics. Theoretical framework of this research was based on models-of-data theory. True-experimental design using quantitative and qualitative research methods was carried out for this research. Participants of this study were 22 senior pre-service physics teachers. The instructional strategy in the experimental class was model-based inquiry (MBI) while it was inquiry in the control class. Data were collected by using Force Concept Inventory (FCI), video recordings, inquiry reports and the instructor's field notes. The results of Mann-Whitney U tests for two classes' pre-tests and post-tests indicated that there was not any significant difference between two classes' performances before and after the treatment. On the other hand, the results of Wilcoxon signed-rank test showed that the experimental class's post FCI scores were better than their pre FCI scores. The following conclusions can be drawn from the study: Putting modelling explicitly into the center of inquiry facilitates conceptual learning. Therefore, model building and formation in inquiry can be seen as a way not only to represent what learners have already known but also to generate new knowledge. Making associations with other phenomena under the framework of epistemic characters of knowledge and expanding on these associations with discussions in inquiry learning environment promote students' understanding. Finally, model quality may stimulate science learning; however, more research is needed to extend this conclusion.