Providing signal priority for buses has been proposed as an inexpensive way to improve transit efficiency and productivity and to reduce operation costs. Bus signal priority has been implemented in several U.S. cities to improve schedule adherence, reduce transit operation costs, and improve customer ride quality. Current signal priority strategies primarily utilize sensors to detect buses at a fixed or preset distance away from an intersection. Traditional presence detection systems, ideally designed for emergency vehicles, usually send a signal priority request after a preprogrammed time offset as soon as transit vehicles are detected without the consideration of bus readiness. The objective of this study is to take advantage of the already equipped Global Positioning System and automated vehicle location system on the buses in Minneapolis, Minnesota, and to develop an adaptive signal priority strategy that could consider bus schedule adherence, number of passengers, location, and speed. Buses can communicate with intersection signal controllers by using wireless technology to request signal priority. Communication with the roadside unit (e.g., traffic controller) for signal priority may be established by using the readily available wireless local area network (WLAN) 802.11×or the dedicated short-range communication (DSRC) 802.11p protocol currently under development for wireless access to and from the vehicular environment. This paper describes the proposed priority logic and its evaluation with the use of microscopic traffic simulation. Simulation results indicate that a 12% to 15% reduction in bus travel time during a.m. peak hours (7 to 9 a.m.) and a 4% to 11% reduction in p.m. peak hours (4 to 6 p.m.) could be achieved by providing signal priority for buses. Average bus delay time was reduced in the range of 16% to 20% and 5% to 14% during a.m. and p.m. peak periods, respectively.