Abstract:We demonstrate a polarization-managed 8-dimensional modulation format that is time domain coded to reduce inter-channel nonlinearity. Simulation results show a 2.33 dB improvement in maximum net system margin (NSM) relative to polarization multiplexed (PM)-BPSK, and a 1.0 dB improvement relative to time interleaved return to zero (RZ)-PM-BPSK, for a five channel fill propagating on 20x80 km spans of 90% compensated ELEAF. In contrast to the other modulations considered, the new 8-dimentional (8D) format has negligible sensitivity to the polarization states of the neighboring channels. Laboratory results from High-density WDM (HD-WDM) propagation experiments on a 5000 km dispersionmanaged link show a 1 dB improvement in net system margin relative to PM-BPSK.