To improve the reliability, responsiveness, and productivity of the flex-route transit service, this paper investigates the vehicle scheduling and routing problem under a dynamic operating environment. First, we discuss the new operating polices after the introduction of intelligent transportation systems (ITSs), including automatic vehicle location (AVL) system, mobile data terminal (MDT), and computer-aided dispatch (CAD) system. Second, a mixed integer programming (MIP) formulation is employed to solve the offline routing problem. Third, an online scheduling scheme is presented to tackle different dynamic events, such as dynamic requests, travel time fluctuations, cancellations of requests, and customer no-shows. Finally, simulation experiments based on a real-life flex-route transit service are conducted to assess the influence of different dynamic events. The results demonstrate that the proposed scheduling scheme is reliable for coping with various dynamic events, and our findings can be used to guide the policy making of flex-route transit services.