We propose a realistic experiment to demonstrate a dynamic Kosterlitz-Thouless transition in ultra-cold atomic gases in two dimensions. With a numerical implementation of the Truncated Wigner Approximation we simulate the time evolution of several correlation functions, which can be measured via matter wave interference. We demonstrate that the relaxational dynamics is well-described by a real-time renormalization group approach, and argue that these experiments can guide the development of a theoretical framework for the understanding of critical dynamics.