Safety, capacity, and timely schedules are some of the most crucial objectives in railway operations. Positive train control (PTC) is a concept whose goal is to improve the safety and efficiency of railway operations by using advanced information technologies. Information technologies such as active communications enable the use of a dynamic headway policy, which can increase the track capacity and improve dispatching efficiency in addition to improving safety. In this paper, we propose a dynamic headway system for PTC based on active communications, which we integrate with a dynamic dispatching model in order to improve track capacity and safety in railway operations. We use a simulation model of a rail network in southern California to demonstrate the effectiveness of our proposed approach. The simulation results of different scenarios show reductions in train delays of at least 55% and reductions in travel time of at least 35% when using the dynamic headway versus using a fixed headway.