Fundação de Amparo à Pesquisa do Estado de São Paulo (FAPESP)Conselho Nacional de Desenvolvimento Científico e Tecnológico (CNPq)We propose a new technique that uses parametric amplification in optical fibers to combine two binary signals into a single quaternary amplitude-shift keying (4-ASK) signal. We develop a theoretical model to predict the power level distribution of the 4-ASK signals as a function of the extinction ratios of the input binary signals. Computer simulation results agree with the predictions of this theoretical model within a 0.9 dB margin. We also analyze the application of this technique to the generation of quaternary-amplitude optical packets, which are attractive for allowing the label to be transmitted in the same bandwidth and simultaneously to the payload. Our results indicate that such optical packets may be propagated through lengths comparable to those involved in metropolitan area networks. (C) 2009 Elsevier B.V. All rights reserved.2833454463Fundação de Amparo à Pesquisa do Estado de São Paulo (FAPESP)Conselho Nacional de Desenvolvimento Científico e Tecnológico (CNPq)Fundação de Amparo à Pesquisa do Estado de São Paulo (FAPESP)Conselho Nacional de Desenvolvimento Científico e Tecnológico (CNPq)CNPq [574017/2008-9, 309031/2008-7, 142270/2007-5, 2008157857-2]