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One of the characteristics of ultrawideband (UWB) signals is pulse distortion, which is inherently determined by their huge bandwidth. Using a cylinder model as an example, pulse distortion and its impacts on UWB system performance have been investigated, based on the closed-form impulse response first derived in this paper. Although a lot of papers have addressed the pulse-distortion issue, quantifying the impacts of pulse distortion on system performance appears to be novel. The simulation results show that the SNR loss caused by template mismatch could reach as high as 4 dB. It is also found that the range error caused by pulse distortion is much larger than the Cramer-Rao lower bound; thus, it is another fundamental source of errors limiting the accuracy of times of arrival of a received signal. These results have direct applications in timing synchronization and positioning.