Eclipse- Dynamic Web Module 3.0 requires Java 1.6 or newer error while creating new project

This is late answer. But may help to other. If you are using Maven based project. You just include following code in pom.xml file. It can be resolved.

<build>
    <plugins>
        <plugin>
            <artifactId>maven-compiler-plugin</artifactId>
            <configuration>
                <source>1.7</source>
                <target>1.7</target>
            </configuration>
        </plugin>
    </plugins>
</build>

Update: Similarly if you are using jdk version 1.8 just include it in your <source> and <target> tags.

Just Change "the dynamic web module version" to 2.5 and than change it back to 3.0 and the error disappears. It worked fine for me.

Answer was correct :), But slightly need a correction.

--> Enable Java compiler to 1.7

--> Facet check java (do not check Dynamic module)

--> Last step check Dynamic module

:)...

after you enable java compiler to 1.7 then go to facet then first check java instead of Dynamic module. Then it will allow you to check the Dynamic module.