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Polarization-mode dispersion (PMD) compensation by low-density parity-check (LDPC) coded turbo equalization is experimentally demonstrated for a nonreturn-to-zero (NRZ) system operating at 10 Gb/s. This technique provides significant improvement of bit-error rate compared to the optimum threshold receiver. The channel capacity loss due to PMD and quantization is studied as well. It was found that the proposed PMD turbo equalizer is about 1.5 dB away from the theoretical limit.