A plurality of terminals, such as digital telephones, are connected to a serial data bus formed by a balanced two-wire line. Each terminal transmits bytes bit-serially with the magnitude bits first, in order of decreasing significance, then the sign bit, and finally an even parity bit to maintain the balance of the line, the "1" bits being transmitted with alternating polarity. The terminals operate simultaneously and in synchronism. If a terminal, during a "0" bit of a byte which it is transmitting, detects a "1" pulse on the bus from another terminal, then it gives up transmission for the remainder of that byte and receives the greater magnitude byte which prevails on the bus. Thus a single two-wire line can be used for digital transmission in both directions between arbitrary numbers of telephones.