High peak-to-average power ratio (PAPR) in orthogonal frequency division multiplexing (OFDM) systems seriously impacts power efficiency in radio frequency section due to the nonlinearity of high-power amplifiers. In this article, an improved gamma correction companding (IGCC) is proposed for PAPR reduction and investigated under multipath fading channels. It is shown that the proposed IGCC provides a significant PAPR reduction while improving power spectral levels and error performances when compared with the previous gamma correction companding. IGCC outperforms existing companding methods when a nonlinear solid-state power amplifier (SSPA) is considered. Additionally, with the introduction of α,β,γ\documentclass[12pt]{minimal}
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\begin{document}$$\alpha , \beta , \gamma $$\end{document}, and Δ\documentclass[12pt]{minimal}
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\begin{document}$$\varDelta $$\end{document} parameters, the improved companding can offer more flexibility in the PAPR reduction and therefore achieves a better trade-off among the PAPR gain, bit error rate (BER), and power spectral density (PSD) performance. Moreover, IGCC improves the BER and PSD performances by minimizing the nonlinear companding distortion. Further, IGCC improves signal-to-noise ratio (SNR) degradation (ΔSNR\documentclass[12pt]{minimal}
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\begin{document}$$\varDelta _{\mathrm{SNR}}$$\end{document}) and total degradation performances by 12.2 and 12.8 dB, respectively, considering an SSPA with input power back-off of 3.0 dB. Computer simulation reveals that the performances of IGCC are independent of the modulation schemes and works with arbitrary number of subcarriers (N), while it does not increase computational complexity when compared with the existing companding schemes used for PAPR reduction in OFDM systems.