This paper describes a study of the development and evaluation of incident-detection algorithms for electronic-detector systems on freeways. The study was in 3 parts. The first part reviewed existing detection algorithms and the development of 2 new detection algorithms. During the development of these 2 algorithms, a section of a freeway lane formed by 2 detectors at both ends was treated as a system, and an attempt was made to express traffic movements by using dynamic equations. The second part invovled the development of a microscopic simulation model of freeway traffic performance. The simulation model was capable of simulating traffic conditions on a freeway under incident and nonincident situations. The output of the simulation model, which was recorded at presence detectors in each lane at 0.125-mile (0.20-km) spacings, was stored on a magnetic tape and played back later to test each detection algorithm. The third part evaluated the newly developed algorithms. The California model, which is considered to be the most widely known algorithm, was compared to the 2 proposed algorithms.