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In this paper, we present a Polarization Division Multiplexing (PDM)-Vestigial Sideband (VSB) transmission technique for advanced terrestrial broadcasting systems. The PDM-VSB transmission combines a PDM composing of polarization states and rotation matrices, and VSB filtering in order to improve both spectral efficiency and reception performance of advanced television systems committee (ATSC)-VSB system. In the corresponding PDM-VSB reception, we present the baseband de-multiplexing schemes and then evaluate the channel capacity and symbol error rate of PDM-VSB system by comparing with those of ATSC-VSB system in the Ricean fading channels. Here, the channel models include channel impairment parameters such as Ricean factor, transmit and receive correlations, cross-polarization discrimination (XPD), and antenna coupling effects.