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We describe the bit-error-rate (BER) performance of an eight-channel wavelength division multiplexing (WDM) local access system using a spectrum-sliced and delay-line-multiplexed light-emitting diode (LED) source. Error-free transmission is demonstrated with all eight channels transmitting at 50 Mb/s using 16 km of distribution fiber. The measured crosstalk penalty is 3 dB and the fiber dispersion penalty is 0.7 dB. The unique properties of the WDM source permit the use of a receiver having 200-MHz bandwidth to minimize crosstalk and dispersion effects at 1.55-μm wavelength even for a source linewidth of 25 nm.