Cyber-physical　system　has　been　widely　used　in　various　areas　as　the　integration　of　computing　and　physical　system.　As　a　typical　application　of　cyber-physical　system,　cyber-physical　surveillance　system　for　transportation　(CPSST)　allows　real-time　video　monitoring　to　facilitate　the　deploying　of　smart　transportation　systems.　For　video　streaming　in　CPSST,　dynamic　radio　spectrum　management　is　a　key　technology　dealing　with　the　current　situation　that　the　spectrum　resource　is　almost　used　up.　In　this　paper,　taking　into　account　the　application　layer　quality　of　service　and　wireless　link　security,　a　novel　dynamic　spectrum　management　scheme　has　been　proposed　to　minimize　the　system　cost　of　CPSST.　Video　distortion　is　considered　as　the　application　layer　quality　of　service　metric,　and　the　system　cost　is　defined　as　a　combination　of　distortion　and　security　cost.　We　use　intra-refreshing　rate　in　video　coding　to　minimize　the　distortion.　Furthermore,　the　problem　is　formulated　as　a　restless　bandit　system,　which　uses　current　and　historical　information　to　optimize　the　action,　with　the　objective　of　maximizing　the　total　discounted　system　reward.　We　also　describe　the　two　spectrum　management　processes.　Extensive　simulation　results　are　presented　to　demonstrate　the　significant　performance　improvement　of　the　proposed　scheme　compared　with　the　existing　one　that　ignores　video　distortion　and　subband　security　optimization.　Copyright　(c)　2014　John　Wiley　&　Sons,　Ltd.