Next generation optical networks will be required to provide increased data throughput on a greater number of optical channels and will also have to facilitate network flexibility in order to adapt to dynamic traffic patterns. Furthermore, the potentially wide deployment of optical Access and Metropolitan networks in particular require that these challenges are met in a cost effect manner. This thesis examines the use of Orthogonal Frequency Division Multiplexing (OFDM) as a means of helping to meet these requirements for next generation optical systems with a high market volume. OFDM is a multi–carrier modulation technique which exhibits high spectral efficiency and a tolerance to chromatic dispersion making it an excellent candidate for use in next generation optical networks. The work presented in this thesis shows how the use of OFDM in conjunction with novel laser devices and direct detection can be used to construct cost effective, low footprint optical systems. These systems are capable of providing >10Gb/s per optical channel and are suitable for implementation as optical access networks. Furthermore, OFDM is shown to be a realistic candidate for use in an optical switching environment where external modulation is employed and, as such, can be considered for use in next generation metropolitan networks.