A tone processing method and communications system which reduce the probability of falsely detecting modem and facsimile communications that occur on a communications link. The link connects a calling endpoint to an answering endpoint. In a preferred embodiment, when the answering endpoint goes off-hook in response to receiving a call from the calling endpoint, an elapse of time is measured while monitoring the link. If a predetermined amount of time elapses without detecting at least one tone on the link, tone detection criteria is modified to reduce tone detection sensitivity, or to ignore tones altogether. In another embodiment, the tone detection criteria is similarly modified if voice activity is detected on the link. In yet another embodiment, when tones and voice activity occur at different times during a call, at least one characteristic is modified to optimize the link for the type of communications occurring on the link.