This Small Business Innovation Research Phase I project will develop an Interfractor which is a new type of robust optical dispersion element that combines a relief grating with appropriately optimized dielectric films to achieve both high dispersion and high efficiency (in excess of 90%) into one diffraction order, independent of polarization. Grating efficiency is critical for wavelength-management in modern fiber-optic telecommunication systems that employ dense wave-division-multiplexing (DWDM) transmission. Dynamic gain equalizers, reconfigurable channel blockers, programmable optical add-drop modules, and wavelength-selective switches all require spatial separation of the wavelengths from an input fiber, typically with a diffraction grating, which is also typically the largest source of insertion loss. Because the polarization of the optical signal of any particular wavelength within a fiber may change over time, the net power loss through the device must be independent of polarization. It is very difficult to achieve high grating efficiency in both polarizations. The Interfractor achieves this goal with a novel and proprietary combination of diffractive and thin-film interference effects, and can be fabricated to be robust over the wide temperature range required of DWDM components. <br/><br/>The most immediate commercial use of the Interfractor will be to improve the insertion loss in free-space optical wavelength-management products, such as dynamic gain equalizers, reconfigurable channel blockers, programmable add-drop modules, and wavelength selective switches now being implemented in modern fiber-optic telecommunication systems that employ dense wave-division-multiplexing (DWDM) transmission. This technology will be implemented in products as soon as Interfractors can be manufactured. The Interfractor will also be a stand-alone product for use in optical analytical instruments, such as spectrometers, that require a combination of high dispersion and high efficiency.