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This paper describes a new technique for implementing an echo canceller for full-duplex data transmission (such as in digital subscriber loops and volceband data sets). The canceller can operate in spite of time-invariant nonlinearities in the echo channel or in the implementation of the echo canceller itself (such as in the D/A converters). The basic structure of the linear echo canceller is not changed, but taps are simply added to account for the nonlinearity. The number of taps which must be added depends on the degree of nonlinearity which must be compensated. Numerical results based on computer simulation are given which show that typical nonlinearities encountered in MOS D/A converters can be compensated by a relatively small number of taps added to the linear echo canceller, and substantial improvement in the cancellation results.