This is the third of three papers [l], [2] dealing with an elastic carrier-concentrator system. The functioning of the subscriber line equipment is described herein. The system serves 256 telephone subscriber lines by digital concentration switching and transmission of multiplexed message channels over a singleT1transmission line. The concentration switching function is nonblocking. Message channels are the individual communication links between terminals and are created on demand at the request of active subscriber lines. They are not merely inactive without service requests; they do not exist unless service is requested. The created message channels serve for their normal communication function and, in addition, carry for each line the ancillary functions of dialing, ringing, and pay-station coin disposal. Message channels are coded by delta modulation, which permits flexible digital concentration and provides a smooth tradeoff of channel quality versus the instantaneous traffic load. Each of two complementary subscriber line interface units, one per line at each end, provides the delta-modulation encoding and decoding functions for the analog voice-band signal input and output and, by overriding the delta codec, provides the desired signaling functions of dialing, ringing, etc. The line interface units provide the major equipment interface between the subscriber line and the digitalT1line. An integral test facility permits remote loop-back of any selected subscriber line unit via a test channel to the office terminals and at the same time connects the subscriber loop to an auxiliary programmed test facility which may transmit pertinent loop-test results to the office terminal.