One embodiment of the present invention provides a system that facilitates quality of service (QoS) in a Fiber Channel (FC) host bus adaptor (HBA). In this system the bandwidth on an FC link between the HBA and the FC switch can be allocated into a plurality of logical channels, and a respective logical channel can transport data frames of variable length. Furthermore, a respective logical channel is associated with a dedicated buffer. During operation, the HBA communicates to an FC switch the HBA's capability of receiving or sending a data flow over a logical channel that couples the HBA to the FC switch. The HBA further receives logical-channel allocation information from the FC switch. Furthermore, the HBA associates data frames with a logical channel and transmits data frames to the FC switch on the corresponding logical channel.