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The strategy of exempting bus from other traffic through exclusive bus lanes (XBL) is prevalent. Rather than just deploying the XBL system, in this study, a new innovative dynamic bus lane (DBL) operation system which is expected to be more productive is initially introduced. Unlike conventional studies which are mainly focused on operational performance of buses, this study attempts to examine the influences on buses and adjacent traffic following the provision of both XBL and the new system. Impact measurements in terms of travel time and traffic conflicts changes are used as assessment indicators. Comparisons with the exclusive bus lane system as well as the mixed traffic flow are analyzed and highlighted through the application of micro-simulation approach. Simulation results showed that both XBL and DBL have positive impact on buses and negative impact on adjacent traffic. Traffic conflicts frequency will increase if either bus lane system is applied. Also it is found that DBL performs better than XBL in terms of achieving the goal of bus operation improvement while limited the performance deterioration to other vehicles and conflicts risks in a relative lower magnitude. Results also suggest the necessity of selecting the optimal strategies according to the tradeoff between the operational performance and safety performance under different traffic conditions.