The City of Hammond v. Schappi Bus Line, Inc., 1927, is a U.S Supreme Court case that revolved around the issue of interstate commerce and its regulation by local authorities. The city of Hammond in Indiana had imposed an annual license fee on buses operating within its boundaries, including those involved in interstate travel like Schappi Bus Line. The bus company challenged this ordinance arguing it was unconstitutional as it interfered with their right to engage in interstate commerce which is under federal jurisdiction according to the Commerce Clause of the Constitution. However, the court ruled against them stating that while states cannot regulate or burden interstate commerce directly, they can indirectly affect such activities through legitimate exercises of police power for public safety purposes - such as requiring licenses for vehicles using their roads even if these are engaged in interstate travel.

In the dissenting opinion for the City of Hammond v. Schappi Bus Line, Inc., it was argued that the city's ordinance did not infrally upon any federal rights and therefore should have been upheld. The dissenting justices believed that there was no conflict between state law and local regulation in this case, as both aimed to regulate traffic for safety reasons. They also disagreed with the majority's interpretation of commerce clause jurisprudence, arguing that a municipality has authority to enact regulations affecting interstate commerce when such regulations are directed towards public safety rather than economic protectionism or discrimination against out-of-state entities. Furthermore, they contended that even if there were some incidental effect on interstate commerce from enforcing local traffic laws, such an impact would be permissible under existing precedents allowing states to exercise their police powers in ways incidentally affecting interstate commerce so long as these actions do not contradict or interfere with federal legislation.