The scheme is likely to include the installation of cameras at known hotspots around the city such the inner ring road, Belmont island and the cattle market roundabout, where images could be beamed back to a control room.
Modern electronic signs could also be erected at most major routes into the city and motorists warned of delays and advised on diversions.
Available car parking spaces in the city’s car parks could also be displayed as well as traffic lights being adjusted so that priority is given to busy roads.
Similar schemes, known as the Intelligent Transport System, are already used across the country’s motorway network.
The proposal is included in the Council’s Local Transport Plan (LTP) – a blueprint for improving transport in the county over the next five years (2006/07 – 2010/11).
The plans are at an early stage and any scheme would be subject to government funding. It is likely to cost six figures.
Other projects proposed as part of the LTP include the Rotherwas Access Road, the introduction of a full-time park-and-ride network and improvements for pedestrians and cyclists.
Cllr Brian Wilcox, Cabinet Member (Highways and Transportation) said: “Tackling traffic congestion is a major issue facing most cities up and down the country. Hereford is no different in that respect.
“We need to keep an open mind on the best way to achieve this and, the intelligent transport system, while a long-term ambition, would allow us to better manage the traffic currently on our roads.
“Herefordshire Council remains optimistic that a successful bid to government is achievable within the next five year period of the Local Transport Plan.
“While the Council is working to alleviate the congestion in the city, motorists also have a responsibility to try and use alternative forms of transport such as buses, bikes and walking.”
Under the LTP, Herefordshire Council will receive £53 million-plus over the next five years to implement new highways initiatives and maintain current roads.
Copies of the LTP will be available on the website in April