A novel design of 2-to-4 photonic digital decoder has been proposed and experimentally demonstrated successfully at 40 Gbit/s. The scheme is implemented by employing differential phase shift keying (DPSK) signals, bit-inverse properties of delay interferometers (DIs), as well as cross gain modulation (XGM) of semiconductor optical amplifiers (SOAs). Correct logic results with high extinction ratios, clear and wide open eyes have been obtained simultaneously, without using any additional input beams. Furthermore, the great potential for hybrid or monolithic integration of delay interferometers and semiconductor optical amplifiers may make the scheme promising candidates for the future ultrafast photonic signal processing applications.© (2010) COPYRIGHT SPIE--The International Society for Optical Engineering. Downloading of the abstract is permitted for personal use only.