Abstract: The method and system for buffering packets such as ATM cells at a queueing point of a device which employs a connection-orientated communications protocol includes the steps of logically partitioning a memory into plural reserved buffer spaces allocated to traffic classes and a shared buffer space available to any connection; determining whether to store or discard a given packet based on predetermined discard criteria; and filling the reserved buffer space to a predetermined state of congestion before storing the given packet in the shared buffer space. Reserved buffer space congestion states are defined with respect to individual connections, groups of connections, and the total capacity of the reserved buffer space itself. Packets are discarded when any, or alternatively a specific combination, of corresponding congestion states occur, and the shared space is congested as well.