Scheduling efforts made without considering the special limitations of the material handling system might lead to infeasible results. This problem especially becomes important when the Automated Guided Vehicles (AGV) are the main material handling media due to their inherent flexibility and adaptability that increase the scheduling complexity. In this thesis, an analytical model is proposed, first, to incorporate the AGV module into the overall decision making hierarchy. A mathematical formulation is developed to include interaction between the AGV module and other modules in the system by considering the restrictions of the material handling system. A micro-opportunistic approach is proposed to solve the AGV scheduling problem. Finally, the proposed method is compared with a number of dispatching rules.