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Photonic crystal fibers (PCFs) offer new possibilities of realizing highly birefringent fibers due to a higher intrinsic index contrast compared to conventional fibers. In this letter, we analyze theoretically the levels of birefringence that can be expected using relatively simple PCF designs. While extremely high degrees of birefringence may be obtained for the fibers, we demonstrate that careful design with respect to multimode behavior must be performed. We further discuss the cutoff properties of birefringent PCFs and present experimental results in agreement with theoretical predictions on both single- and multimode behavior and on levels of birefringence.