The need for CP can be avoided if the wavelet packet transform (WPT) is used in CO-OFDM systems instead of discrete Fourier Transform (DFT) and inverse DFT (IDFT) [13]. The sinusoidal functions are infinitely long in the time domain while wavelets have finite length being localized in time and in frequency domains [13]. Wavelet signal analysis can be a base for an effective computational algorithm which is faster and simpler than FFT [14]. Wavelets have been used in optical communications for time-frequency multiplexing and ultrafast image transmission [14]. A signal may be expanded in an orthogonal set of wavelet packets (WPs) as the basis functions, each channel occupies a wavelet packet (WP), and IDWPT/ DWPT are used at the transmitter and receiver, respectively [13].In this chapter, we consider the CO-OFDM based on WPT and its influence on the optical communication network performance. The chapter is constructed as follows. In Section 2, we review the coherent optical communication systems. In Section 3, we discuss high SE CO-OFDM system. In Section 4, we discuss the OFDM based on WPT and present the original results for the WPT-OFDM system performance. In Section 5, we present the original results concerning the simulations of the structure and operation mode of the novel passive components for all-optical signal processing based on Si-on-insulator (SOI) structure, and a novel hierarchical architecture of the 1Tb/s transmission system based on WPT-OFDM [15]. In Section 6, conclusions are presented.