A method of operating a pressure compensated fuel injector includes: filling a fuel chamber with a charge of fuel by closing an injector valve and circulating a fuel from a fuel source through a plurality of recirculating valves and a cap valve; then isolating the fuel chamber and the charge of fuel from the fuel source; then equalizing a pressure within the fuel chamber to a rising pressure outside the fuel chamber by reducing a volume of the isolated fuel chamber; and then activating a solenoid that is coupled to the injector valve, opening the injector valve; and then further reducing the volume of the isolated fuel chamber to apply an over pressure within the chamber, pumping fuel from the fuel chamber through the injection orifice.