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An ultracompact optical-multiplexer-based two-mode interference (TMI) coupler has been designed for the first time using a mathematical model based on sinusoidal modes and implemented with silicon nano-waveguides. The multiplexing characteristics of the device are verified with the beam propagation method and are also demonstrated experimentally. The coupling length for the TMI coupler for multiplexing of wavelength channels of spacing ~10 nm is five times less than that of a conventional multimode interference (MMI) coupler of width 660 nm. The effect of fabrication tolerance on crosstalk of the TMI coupler is found to be less than that of conventional MMI couplers and of TMI coupler based on tooth-shaped grating structure.