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This paper focuses on the analog VLSI design of a reduced KII set and network, which are basic building blocks in the computational model of the olfactory cortex proposed by Walter Freeman. Previous implementation issues were discussed in 2001, but this paper will present recent developments in the circuit design of individual blocks in a reduced KII set as well as a system architecture for the KII network. The coupling coefficients are built into the chip and the shape of the nonlinear block is controlled externally. To improve the efficiency of the nonlinear block and to reduce the problem of massive interconnections in the KII network, a mixed-signal design to multiplex nonlinear blocks is proposed. Simulation results and chip measurement are presented for the reduced KII set.