We have developed a CDMA based residential indoor system that uses time division duplexing with dynamic channel allocation. The proposed indoor system shares the same frequency band as the outdoor ANSI-008 based cellular PCS network and operates within its coverage area. Due to the time division duplexing nature of the residential system, both the forward and reverse link signals are transmitted in the same frequency band in different time slots. In principle the indoor system may operate either in the PCS uplink or the PCS downlink frequency band. After extensive simulations, we conclude that underlaying such a system to the existing ANSI-008 PCS system is feasible. Addition of such a system would ultimately increase the CDMA capacity substantially.