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In this paper, we study the use of iterative multiuser detectors for co-channel interference suppression in wireless cellular systems. We demonstrate that a receiver with a single receive antenna is capable of detecting and cancelling a single in-band interferer that uses the same coding and modulation scheme as the desired signal. We investigate the benefits of using such an interference canceller in the mobile receiver in the downlink scenario of a two-hop relay network. Results show significant improvements with iterative interference cancellation in terms of the average system throughput and outage probability. Because the interference canceller is so effective, more aggressive frequency reuse schemes can be now considered, such as using smaller cluster sizes, using 3-sectored cells where all sectors share the same frequency band, and using non-orthogonal channels for relaying.