A two-layer hierarchical structure for urban traffic dispatching control is proposed. The system operates in a heuristic manner and resolved a resource allocation problem in real time, related to the Dial a Ride (DAR) case. To decrease the complexity of the initial large-scale problem of resource allocation, space and time decomposition is performed. The space decomposition allows us to obtain local, low dimensional resource allocation problems. The time decomposition defines a discrete time optimization problem of resource allocation, which is solved by a central dispatching unit (CDU). It performs the resource allocation among the subsystems in accordance with the state imbalance, defined by the different number of unserved requests in the subsystems. The lower layer problems are solved by local dispatching units (LDU) which perform optimal vehicle routing and service of requests in real time. Special procedures, suitable for on-line control, are proposed for obtaining the upper layer solutions and for information transfer between the layers. The behaviour of a taxi system is simulated and the positive influence of the upper layer is shown.