A combined input/output control system is presented for periodically determining the set of jobs to be released (input variables) and the capacities of processing centers (output variables) in the dynamic job shop, so that a composite cost function is minimized. An interactive heuristic optimizing algorithm incorporating a 0-1 linear mixed integer program is formulated. The resulting control system is compared by simulation with an alternate system for which only input is subject to control. Significant improvements are obtained for most performance measures evaluated. © 1987 Taylor & Francis Group, LLC.