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Orthogonal frequency division multiplexing (OFDM)is a promising technology for optical communications. OFDM is a modulation technique in which the other subcarriers have zero amplitude at the peak of each subcarrier. S ince it is an effective solution to inter symbol interference caused by a dispersive channel, OFDM can be used in most new and emerging broadband wired and wireless communication systems. The main drawback of OFDM is its high peak to average power ratio (PAPR) that can be alleviated by an effective technique called the pilot-assisted PAPR reduction technique. This technique is much more efficient than clipping method. This paper makes the comparison of conventional optical OFDM (OOFDM) and pilotassisted OOFDM (PA-OOFDM) so as to show that PA-OOFDM completely eliminates the PAPR. The comparison of BER performance of BPS K and QAM is also discussed.