Abstract: An optical network unit includes silicon-germanium electronic and optoelectronic devices and silicon-based very large scale integrated circuits (VLSIs) monolithically integrated in the save substrate and method of fabrication therefor. The optical network unit installed at a local computer is connected to incoming and outgoing optical fibers for receiving information from and transmitting information to the fiber network system. An optical branching circuit includes an optical coupler splits the incoming light from the fiber into two parts. One branch of the light is detected by a photodetector and subsequently amplified before sent to electronic circuit for down-loading data from the fiber network. Another branch of the light guided by optical waveguide is connected to a modulator. The modulator modulates the light of the second branch according to the electrical signal from the local electronic circuits. The modulated light is then fed back to the fiber network for up-loading data from the local computer.