Crosstalk and noise in optical communications system transmitters, channels, amplifiers and receivers limit system performance and reliability. Optoelectronic Data Systems, Inc., investigates the feasibility of differential signaling to alleviate these problems by pre-compensating for channel non-idealities. The first objective is to analyze and simulate the benefits of differential signaling in fiber-optic telecommunications, optical amplifiers, optical memories and optical crossbar switches. The benefits include longer bandwidth-distance products, higher channel density, lower switching energy, lower BER, and longer MTBF. In addition, they perform two experiments that demonstrate the potential benefits and validate their theoretical predictions: one on integrated differential optoelectronic detector/amplifiers; the other on semiconductor optical amplifiers.