A fast, lightweight, reliable, packet-based protocol that operates independent of the type of networking protocol used by the underlying physical layer of the network is disclosed. More specifically, the packet based protocol operates independently of or is capable of encapsulating physical layer protocols such as but not limited to MAC, Ethernet, Ethernet II, HARD or IP. The protocol defines at least three different types of frames including Information frames, Supervisory frames, and Unnumbered frames. In various embodiments of the invention, the Information, Supervisory, and Unnumbered frames include DSAP and SSAP field with semantics which are sufficiently large to support the various physical layer protocols that may be used on the network. The Information frames, Supervisory frames, and Unnumbered frames also have the ability to support urgent data delivery and certain memory management functions. The protocol is further capable of support the multiplexing of layers higher than the protocol so that multiple higher layer applications may share the same connection. Finally, the protocol of the present invention supports both flow control and congestion control, to help reduce the incidence of lost or dropped packets at a receiving node or over the network respectively.