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The rapid increase in vehicle population has led to an increase in road congestion, pollution and accidents. We propose a framework that optimizes collection, classification, scheduling and dissemination of traffic information to deliver adaptive traffic signal management and emergency vehicle management in vehicular ad-hoc networks. The former allows dynamic traffic signal control and traffic flow while the later allows emergency vehicles to pass at their maximum speed. In the proposed scheme, sensor nodes monitor traffic information and transmit it to a Dynamic Traffic Management Center (DTMC). It dynamically determines priority of the road segment as critical, high, medium and low using fuzzy logic. Packets are transmitted to DTMC using congestion-aware routing algorithm. The results are simulated in Network Simulator Version 2 and demonstrate that the proposed approach clears emergency …