In optical fiber communication systems, the diode LED (light-emitting) or diode (laser) is usually used as a source of semiconductor components in the optical fiber communication system. The main differences between LED and laser diode is issued by the former light is incoherent (noncoherent), while the latter is coherent supercontinuum light. Using semiconductor benefit as a light source is small volume, high luminous efficiency, good reliability, and the optimization of wavelength, is more important in high frequency operation of a directly modulated semiconductor light source, very suitable for the demand of optical fiber communication system.

Led by electroluminescence (electroluminescence) the principle of a non coherent light, spectrum is usually dispersed among the 30 nm to 60 nm. Another drawback is that the LED is poor luminous efficiency, usually only 1% of the input power can be converted into optical power, about 100 watts (micro-watt) or so. But the cost of LED is low, so it is often used in low price. Commonly used in optical communication led the main material is gallium arsenide or gallium arsenide phosphide (GaAsP), the emission wavelength is about 1300 nm, than GaAs 810 nm to 870 nm is more suitable for used in optical fiber communication. Because of the wide spectrum of LED, the dispersion is very serious, and it also limits the product of its transmission rate and transmission distance. LED is usually used in area network 10Mb/s 100Mb/s (LAN), transmission distance is also within a few kilometers. Currently has led contains a number of quantum wells (quantum well) structure, LED can emit different wavelengths of light, covering a wide spectrum, the LED is widely used in the area of the wave division multiplexing (WDM) networks.

The output power of the semiconductor laser usually at around 100 milliwatt (MW) and homological properties of light source, direction of relatively strong, usually with a single-mode fiber coupling efficiency up to 50%. The output spectrum of the laser is narrow, and it can also help to increase the transmission rate and reduce the mode dispersion (dispersion model). Semiconductor lasers can be modulated at a very high operating frequency because of the very short duration of time (recombination).

Semiconductor laser is usually by the input current has no direct modulation of the switch state and the signal output, but for some transmission rate very high or very long distance application, laser light source may will to control the form of CW (continuous wave), for example using built-in electrical absorption optical modulator (electroabsorption modulator) or is Mach Zehnder interferometer (Mach Zehnder interferometer) of optical signal to be modulated. External modulation components can significantly reduce the laser's "pulse chirp". Chirped pulse can change the width of the laser spectrum, which makes the dispersion in optical fiber become serious.