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Addresses the deadlock avoidance problems in manufacturing systems with sequence and route flexibility. It is shown that for a large class of such systems, through one-step look ahead, an optimal deadlock avoidance policy can be obtained. For a general system the authors present a system reduction method by which the system is reduced and the reduced system has an optimal deadlock avoidance policy. Using this optimal control policy and restricting the allocation of resources with capacity one, a sub-optimal deadlock avoidance policy for the system is obtained. The proposed policies have polynomial computation complexity.