This paper describes recent trends in transit bus design in the United States and Western Europe. It discusses the basic legal, regulatory, and operational constraints that historically have guided the design of full-size transit buses. It specifically addresses the implications of the constraint that fare payment must occur on-board the transit bus and be monitored by the driver. Future bus design concepts are presented which demonstrate the improvements that would be possible in service characteristics if this constraint were removed. The material presented is based in part upon research conducted for the Urban Mass Transportation Administration on the impact of fare collection on transit bus design.