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Recent work has shown that multiple-input multiple-output (MIMO) systems with multiple antennas at both the transmitter and receiver are able to achieve great capacity improvement. In such systems, it is desirable to select a subset of the available antennas so as to reduce the number of radio frequency (RF) chains. This paper addresses the problem of antenna selection in correlated channels. We consider a narrowband communication system with M transmit and N receive antennas. We present the criterion for selecting the optimal Lt out of M transmit and Lr out of N receive antennas in terms of capacity maximization, assuming that only the long-term channel statistics, instead of the instantaneous channel-state information, are known. Simulations will be used to validate our theoretical analysis and demonstrate that the number of required RF chains can be significantly decreased using our proposed selection strategy, while achieving even better performance than the conventional MIMO system without antenna selection.