Yes, it can be done. I'm doing something like this at the moment, and you just need to keep a few things in mind.

As Andy said, with only one shared wire available, only one end can transmit at a time, which means we are talking half duplex. The comms line is a shared resource, which means you need a protocol so that each end knows whether it is allowed to transmit (i.e. has ownership). This is a common requirement and you should look at how RS485 systems handle it. A master-slave arrangement is a simple way of doing this, as long as the slave never has to interrupt the master.

For my application I'm just going to drive the line at TTL levels using a tristate buffer. The buffer enable is effectively the RTS signal.