The latest advances in information technology, such as automatic vehicle location, digital telecommunications, and computers, have renewed interest among public transit agencies in applying these technologies to enhance the efficiency and reliability of their paratransit systems. This interest has also induced a need for relevant methodologies and tools that can help address some fundamental questions on the cost-effectiveness of these technologies. This type of evaluation has mostly relied on field studies that usually require a significant expenditure and are conditioned to limited operating environments. A simulation system is presented that has been developed to model a variety of technology-oriented dial-a-ride paratransit systems, offering a way to complement or replace the field evaluation method. The general concepts and models applied in the simulation system are discussed, focusing on how various components are modeled and how they interact with each other in the overall simulation framework. The simulation system is applied to evaluate the effects of trip cancellation on the operational performance of a partly synthetic paratransit system, with the goal of quantifying the potential benefits that may be attained by accepting real-time demand trips.