Autonomous navigation on the open sea involving automatic collision avoidance and route planning helps to ensure navigational safety. To judge whether all target ships (TSs) will pass safely and find the optimal route under multi-ship encounter situations, the relationship between the variations in the own ship (OS) velocity vector after nonlinear course altering motion and the collision avoidance result, which is defined as the collision avoidance mechanism, was analyzed. Methods producing the optimal route were also proposed. First, the static collision avoidance mechanism based on the ship domain and velocity obstacle (VO) was introduced. On that basis, the collision-free course alteration range of the OS, without consideration of the real manoeuvring process, was presented. Second, the ship motion equations and fuzzy adaptive proportion integral derivative (PID) control method were combined to develop a course control system. This system was then used to predict OS motions during the course-altering process. Based on this prediction, TS positions were calculated. Subsequently, the dynamic collision-free course altering ranges for the OS were obtained. Third, a model to compute the optimal route was introduced. Finally, simulations were performed under a situation including six TSs and two static objects, and the shortest collision-free route that satisfies both regulations for preventing collisions and good seamanship was found.