Modular buses are a new type of transportation vehicle that can be combined and divided during operation. The application of this vehicle can improve the operating efficiency of the bus system and reduce the travel time of passengers, but it is still worth discussing how to lay out the bus lines. This paper proposes a two-level line layout strategy for modular buses in urban arterial corridor, which is composed of the main line and the auxiliary line. Under this strategy, an optimization model for modular bus line layout plan is established by minimizing both the travel time cost of passengers and the operating cost of bus company, and taking the numbers of stations served by the bus line and bus departure frequencies as decision variables. An artificial bee colony algorithm is then designed to solve the proposed model. Compared with the traditional bus line layout method, the two-level line layout method for modular buses proposed in this paper can improve passenger travel efficiency and reduce bus operating cost.