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The performance of turbo codes is examined over the Ricean fading channel with soft-decision differential phase detection (DPD). M-ary continuous phase frequency-shift keying (CPFSK) signaling and puncturing of the coded sequence are considered to achieve bandwidth efficient communication. The effects of the number of phase decision regions, fading conditions, number of states of the constituent codes, and code rate are examined. A bit error rate upper bound is developed, which is useful at low values of bit error probability where computer simulations are lengthy. Significant gains using soft-decision DPD over hard-decision DPD and conventional noncoherent detection are reported.