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A new frequency reuse scheme which reduces co-channel interference must be used to deploy over 20-GHz band fixed wireless access (FWA) systems in expanding service areas. Also, the capacity has become of primary importance in broadband wireless access (BWA) networks to provide multimedia services or other digital services requiring high capacity traffic channels. The co-channel interference and rain fading consider as major limitation factor for the system capacity. In the system point of view a moving rain cell over the LMDS service area will not only attenuate the desired signal but also the interferer. The location dependent C/I in the LMDS service area under rainy conditions with and without site diversity technique is calculated and simulated. Different cell sizes of LMDS are considered for significant analyses and discussions. It is found that site diversity has high ability to improve the performance level of all LMDS service area especially under rainy conditions.