A dynamic dither gain control technique for multi-level delta-sigma Digital-to-Analog Converters (DACs) using multi-stage Dynamic Element Matching (DEM) with a second order loop filter is proposed. The proposed technique provides improvement on the mismatch shaping performance through dynamic control of delta-sigma modulator dither gain. A large dither gain, which suppresses DEM operation dependency on input signal, is applied to delta-sigma modulator, when DEM loop filter output is greater than a designed reference. The design example using the proposed technique on a third order 17-level delta-sigma modulator with 3-stage cascaded DEM is shown in this paper. Simulation result with 1% analog segment mismatch shows over 10dB improvement of THD+N performance under -50dB amplitude input signal, compared to the case without the proposed technique.