Abstract: A system for signal stabilizing in-phase modulated optical hydrophone arr employs interferometry with homodyne detection. Phase stabilization is accomplished by modulating the input laser signal in proportion to variations in the output of an optical transducer to balance the output phase so that the fringes are kept at optimum position. Additionally, fluctuations in light intensity are compensated for so that a photodetector responds only to phase shift variations. The technique used is to split the input beam into signal and reference beams using a beam divider, exposing the signal beam to the acoustic pressure of interest, recombining the signal beam with the reference beam, detecting the combined beams and filtering the resulting signal to separate out the acoustic information of interest from the phase shift and light intensity portions used to stabilize the input beam.