We propose the use of cross-phase modulation (XPM) and four-wave mixing (FWM) in dispersion-flattened highly nonlinear photonic crystal fibers (HNL-PCFs) to implement the functionalities of wavelength conversion, simultaneous time demultiplexing and wavelength multicasting in optical time-division multiplexing (OTDM) systems. The experiments on wavelength conversion at 80 Gbit s−1and OTDM demultiplexing from 80 to 10 Gbit s−1 with wavelength multicasting of two channels are successfully demonstrated to validate the proposed scheme, which are carried out by using two segments of dispersion-flattened HNL-PCFs with lengths of 100 and 50 m, respectively. Moreover, the bit error rate (BER) performance is also measured. The results show that our designed system can achieve a power penalty of less than 4.6 dB for two multicasting channels with a 24 nm wavelength span at the BER of 10−9 when compared with the 10 Gbit/s back-to-back measurement. The proposed system is transparent to bit rate since only an ultrafast third-order nonlinear effect is used. The resulting configuration is compact, robust and reliable, benefiting from the use of dispersion-flattened HNL-PCFs with short lengths. This also makes the proposed system more flexible in the operational wavelengths than those based on dispersion-shifted fibers and traditional highly nonlinear fibers.