Abstract: A regenerator for restoring the originally encoded optical phase of a differential-phase-shift-keyed signal. In an embodiment, the regenerator simultaneously provides limiting amplification and reduces amplitude noise based on a phase-sensitive optical amplifier that combines a weak signal field of a degraded input data with a strong pump field supplied by a local oscillator in a nonlinear interferometer. The two fields interact through degenerate four-wave mixing, and optical energy is transferred from the pump to the signal and vice versa. The phase sensitive nature of the optical gain leads to amplification of a specific phase component of the signal, determined by the input pump-signal phase difference and the incident signal phase is restored to two distinct states, separated by 180° according to the original encoding. Simultaneously, gain saturation of the pump wave by the signal wave results in limiting amplification of the signal wave for removing signal amplitude noise.