A real-time scheduling problem, specifically rescheduling under machine breakdowns, is considered in this thesis. A heuristic approach is developed for a manufacturing cell with a modified flow shop structure. The strategy reschedules part of the initial schedule to match up with the preschedule at some point. In contrast to other studies, the objective is to create a new schedule that is consistent with the other production planning decisions like material flow and purchasing by utilizing the time critical decision making concept. In the proposed heuristic approach, a new rescheduling strategy is developed and different match-up points are defined for each machine in order to maximize the flexibility during rescheduling. It is compared with alternative reactive scheduling methods in an experimental design and significance of some factors are tested by analysis of variance tests.