In a communication system in which a transmitter transmits data over a communication channel of a fixed bandwidth to a receiver, the method according to which the transmit data rate is continuously adjusted to a rate which is substantially equal to a short-term average data rate. The channel capacity and/or other characteristics of the system, is continuously adjusted, through changes in transmit power, symbol rate and modulation format, to a level at which the ratio of received signal energy per bit to noise spectral density (E.sub.b/N.sub.0) at the receiver is close to but above its minimum acceptable level, thereby matching the channel capacity and/or other characteristics of the system to the traffic. The system has further attributes which adjust the transmit data rate responsive to conditions involving at least one of data traffic levels, power reserve emergency, thermal load and message priority.