This paper reviews recent advances in 40-Gbit/s class analog and digital ICs developed at our laboratories for future lightwave communications systems. A 0.1-mu m gate InAlAs/InGaAs HEMTs with InP recess etch stopper was adopted mainly for IC fabrication Fabricated ICs demonstrate excellent data-multiplexing, demultiplexing and amplifying operation at 40 Gbit/s.