A system and method for providing mobile switching center (MSC) initiated service negotiation in a wireless communication system. If a new call arrives for a subscriber unit while the subscriber unit is already on the traffic channel, a change in the service configuration may allow the subscriber unit to receive the new call while preserving the old call. MSC initiated service negotiation may be used to establish the change in service configuration. The MSC transmits a Change Service Command message to the base station in whose coverage area the subscriber unit is located. The Change Service Command proposes a new service configuration to accommodate both the old and the new call. The base station, subscriber unit, and MSC may interchange further messages to modify the proposed service configuration if necessary. Messages are exchanged until the base station, subscriber unit, and MSC reach an agreement regarding the new service configuration. The present invention also provides support for soft handoff. The new service configuration is presented to all target base stations involved in the soft handoff, so that the subscriber unit may make use of the new service configuration while in soft handoff.