The primary application of fiber Bragg gratings is in optical communications systems. They are specifically used as notch filters. They are also used in optical multiplexers and demultiplexers with an optical circulator, or optical add-drop multiplexer (OADM). the figure above shows 4 channels, depicted as 4 colours, impinging onto a FBG via an optical circulator. The FBG is set to reflect one of the channels, here channel 4. The signal is reflected back to the circulator where it is directed down and dropped out of the system. Since the channel has been dropped, another signal on that channel can be added at the same point in the network.
A demultiplexer can be achieved by cascading multiple drop sections of the OADM, where each drop element uses an FBG set to the wavelength to be demultiplexed. Conversely, a multiplexer can be achieved by cascading multiple add sections of the OADM. FBG demultiplexers and OADMs can also be tunable. In a tunable demultiplexer or OADM, the Bragg wavelength of the FBG can be tuned by strain applied by a piezoelectric transducer. The sensitivity of a FBG to strain is discussed below in fiber Bragg grating sensors.