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A novel joint adaptive modulation scheme for the broadcast phase of a two-way relay channel is presented. Over Rayleigh flat fading channels, by jointly encoding and modulating the messages from both users according to each user's instantaneous channel quality, the relay can greatly improve its bits-per-symbol throughput during the broadcast phase. Also, each user can receive at the data rate decided by its instantaneous channel quality under the target average bit error ratio constraint by interference cancellation using its own information. Computer simulation shows the proposed scheme provides about 3'dB gain over the network coding based adaptive modulation scheme.