A joint "packet-optical" layer restoration mechanism protects against single, packet-layer router failures by managing network resources from both the packet layer and the optical transport layer in a synergistic manner. It reuses packet-layer router service-ports and/or transport-layer service wavelengths associated with optical switch-ports instead of reserving additional standby packet-layer router service-ports. It can reuse resources from primary paths that are unaffected by router failures and paths that exist for link-failure protection at the optical layer. Embodiments feature a modified node structure that includes both an IP router and a dynamically reconfigurable OXC, which dynamically establishes connectivity between IP-router ports and transport-layer optical fibers. The joint-layer router provides fine-granularity grooming at the IP layer and full-fledged wavelength networking via dynamic wavelength switching and/or wavelength translation at the optical layer. The latter can change the wavelength cross-connections on-demand to perform restoration or to modify the connectivity between IP routers in the network.