Full-waveform inversion (FWI) has proved effective in significantly improving the spatial resolution of seismic velocity models. However, it is implemented mostly for isotropic media and the applications to anisotropic models are typically limited to acoustic approximations. Here, we develop a foundation for elastic FWI in laterally heterogeneous VTI (transversely isotropic with a vertical symmetry axis) media. The model is parameterized in terms of the P- and S-wave vertical velocities and the P-wave normal-moveout and horizontal velocities. To derive the gradients of the objective function with respect to the VTI parameters, we employ the adjoint-state method. The iterative inversion is performed in the time domain using the steepest-desc...