The IEEE 802.15.4 standard specifies the physical and medium access control layers designed for low-rate wireless personal area networks. Its operational frequency band includes the 2.4GHz industrial, scientific and medical band, which is also used by other IEEE 802 wireless standards. This paper presents the coexistence model of IEEE 802.15.4 with IEEE 802.11b interference in fading channels and proposes two adaptive channel allocation schemes. The first avoids the IEEE 802.15.4 interference only and the second avoids both of the IEEE 802.15.4 and the IEEE 802.11b interferences. Numerical results show that by selecting a channel which gives the maximum signal to noise ratio to the system, the proposed algorithms are effective for avoiding the interferences and for maximizing the network capacity.