<p>Selecting between fixed and flexible transit services is critical for improving transit service efficiency. This study develops two models to characterize the costs of fixed and flexible transit service systems and derives the critical conditions for fixed and flexible transit service selection. The results indicate that the selection between the two transit services depends largely on the stop-induced cost (defined as the combined passenger walking cost and stop delay cost in the fixed-transit service) of fixed transit services and the lateral and detour costs of flexible transit services. When the stop-induced cost is lower than the sum of the flexible transit service’s lateral detour operational costs, fleet costs, and lateral in-vehicle time cost, fixed transit service is preferred; if the stop-induced cost is larger than the sum of the flexible transit service's lateral and detour operating costs and the in-vehicle costs of passengers’ lateral detour times and stopping delays, the flexible transit service is a preferred option. If the stop-induced cost falls between these two sums, thresholds exist for demand intensity, service area aspect ratio, and block size that determine the optimal selection. If the actual values of demand intensity, service area aspect ratio, and block size are below their respective thresholds, then the flexible transit service should be selected, and otherwise, the fixed transit service is preferred. A numerical example and case study illustrate the impacts of these factors and provide new insights.</p>