Modulating retro-reflectors (MRR) couple passive optical retro-reflectors with electro-optic modulators to allow free-space optical communication with a laser and pointing/acquisition/tracking system required on only one end of the link. In operation a conventional free space optical communications terminal, the interrogator, is used on one end of the link to illuminate the MRR on the other end of the link with a cw beam. The MRR imposes a modulation on the interrogating beam and passively retro-reflects it back to the interrogator. These types of systems are attractive for asymmetric communication links for which one end of the link cannot afford the weight, power or expense of a conventional free-space optical communication terminal. Recently, MRR using multiple quantum well (MQW) modulators have been demonstrated using a large area MQW placed in front of the aperture of a corner-cube.For the MQW MRR, the maximum modulation can range into the gigahertz, limited only by the RC time constant of the device. This limitation, however, is a serious one. The optical aperture of an MRR cannot be too small or the amount of light retro-reflected will be insufficient to close the link. For typical corner-cube MQW MRR devices the modulator has a diameter between 0.5-1 cm and maximum modulation rates less than 10 Mbps. In this paper we describe a new kind of MQW MRR that uses a cat's eye retro-reflector with the MQW in the focal plane of the cat's eye. This system decouples the size of the modulator from the size of the optical aperture and allows much higher data rates. A 40 Mbps device has been demonstrated.