In this paper, we present a priority scheduling algorithm at ATM switches with multi-class output buffers in which the service rate of each class buffer is dynamically adjusted. The service rate is computed periodically by a control scheme. We derive the design formulas of the control scheme to ensure that each class buffer occupancy converges to its desired operating point related to QoS requirement. Moreover, through dynamic service rate control in the proposed scheduling algorithm, the available channel capacity can be estimated exactly. It may be used for rate control of ABR traffic and call admission control of the other real-time traffic (CBR, VBR, etc. ).