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ABSTRACT (Aaxnmum 200 words)A novel optoelectronic neural network has been designed and constructed to recognize a set of characters from the alphabet. The network consists of a 15Xl binary input vector, two optoelectronic vector matrix multiplication layers, and a 15X1 binary output layer. The network utilizes a pair of custom fabricated Spatial Light Modulators (SLMs) with 120 levels of gray scale per pixel. The SIMs realize the matrix weights. Previous networks of this type were hampered by limited levels of gray scale and the need to use two separate weight masks (matrices) per layer. The weight masks are operated in unipolar mode. This allows both positive and negative weights to be realized from the same mask. A hard limiting function is used for the network's nonlinearity. A modification of Widrow's lesser known MR2 training algorithm is used to train the network. Furthermore, the network introduces a novel lens-free crossbar matrix-vector multiplier. multiplier.