A special class of recurrent neural networks (RNN) has recently been proposed by Zhang et al. for solving online time-varying matrix problems. Being different from conventional gradient-based neural networks (GNN), such RNN (termed specifically as Zhang neural networks, ZNN) are designed based on matrix-valued error functions, instead of scalar-valued norm-based energy functions. In this paper, we generalize and further investigate the ZNN model for time-varying matrix square root finding. For the purpose of possible hardware (e.g., digital circuit) realization, a discrete-time ZNN model is constructed and developed, which incorporates Newton iteration as a special case. Besides, to obtain an appropriate step-size value (in each iteration), a line-search algorithm is employed for the proposed discrete-time ZNN model. Computer-simulation results substantiate the effectiveness of the proposed ZNN model aided with a line-search algorithm, in addition to the connection and explanation to Newton iteration for matrix square root finding.