AbstractThe transportation sector is an integral part of the US economy. It employs millions of people and incorporates 8.9% of the nation’s economic activity as measured by gross domestic product. According to the US Department of Transportation, about 48,280 km (30,000 mi) of the busiest highways will be jammed daily by 2040, which requires an essential increase in the capacity of the transportation system. Underground logistics transportation (ULT) is a class of automated transportation systems in which vehicles carry freight through tunnels and pipelines between intermodal terminals. Construction of intermodal ULT systems through tunnels or pipelines can increase the existing shipping network capacity. Therefore, considering the intermodal terminal as a substantial component of the ULT, it is important to evaluate the present terminal’s capacity by studying the effect of different operational components on terminal performance. The objective of this study is to develop a framework for optimizing the capacity of intermodal ULT terminals through the discrete event simulation (DES) model. To optimize terminal operations, a base model and two different scenarios are developed and simulated within which the variations of performance indicators are tested. Outputs from all three models are compared to the ULT annual expected shipped containers and the results from the two latter scenarios show 34 and 59% improvements in the number of shipped containers, respectively.