Abstract: A laser transmitter used in an optical communication system provides automatic compensation/stabilization of CNR (carrier to noise ratio) and OMI (optical modulation index) in conditions that would have caused these parameters to change if the compensation circuitry was not employed. The compensation circuitry is an open loop that operates in conjunction with a conventional APC (automatic power control) loop. When certain parameters change (i.e., temperature, laser aging, intentional change in optical power) they will affect the laser DC current (either directly or because of the existence of the APC loop) and as a result the CNR/OMI will change. The compensation circuitry senses the change in the laser DC current and changes the modulating current to the laser as required to minimize changes in CNR/OMI.