The use of a bi-directional, as opposed to a one-way, transportation system, can increase the operational efficiency of automated guided vehicles in both manufacturing and warehousing environments. However, the full potential will only be realized if the routeing algorithms pay particular attention to the problem of collision avoidance. This paper is concerned with the development of such an algorithm. The method is based on the use of delays and deviations to avoid collisions that could arise when using the shortest routes for each vehicle, and is applicable to any transportation system which can be represented as a network with known travel times.