The demand for high-speed mobile wireless communications is growing at a very fast rate.WDM technology is a key technique for achieving the high data rate and spectral efficiency requirements for wireless communication systems. Wavelength division Multiplexing (WDM) [3–6] has emerged as a successful air-interfacetechnique. TheWavelength division Multiplexing was originally developed from the multi-carrier modulation techniques used in high wavelength military radios. This thesis presents, a simulink based simulation system is implemented using Additive White Gaussian Noise channel (AWGN) to study the performance analysis of Bit Error rate (BER) Vs Signal to Noise ratio (SNR). The model of WDM with Rician fading channel using simulink in MATLAB is discussed. This model is used for performance enhancement of the WDM with QPSK and QAM modulation schemes and channel condition. The throughput and packet error rate are used to evaluate the performance of MAC layer with the change in physical layer parameter.The performance analysis of different technique used in the QAM WDM is compared by visualizing the BER vs SNR curve.