Performance analysis is carried out for an all-optical wavelength converter based on cross-phase modulation in two semiconductor optical amplifiers (SOAs) arranged in a Mach-Zehnder interferometer configuration to evaluate the efficiency of conversion and the signal-to-crosstalk ratio (SCR) at the output of the converter. The results evaluated analytically for input non-return to zero signal at a bit rate of 10 Gb/s show that conversion is possible over a wavelength separation of 2 nm between the pump and the input wavelengths. It is further noticed that SCR of the order of 50 dB or more can be achieved at a bit rate of 10 Gb/s, optical amplifier bandwidth of 10 times bit rate and driving current of 600 mA when the input pump is 60% of saturation intensity. The range of wavelength conversion can further be increased by increasing the driving current. (C) 2003 Elsevier Science Ltd. All rights reserved.