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In this letter, a novel decode-and-forward (DF) strategy for the two-way relay over Rayleigh fading channels is presented and analyzed. By encoding the two messages jointly at the relay node, the proposed scheme (termed DF-JM) can effectively handle matched or unmatched data rates from the two sources. In addition, it is possible to design optimal constellation labeling maps at the relay node, so that the minimum Euclidean distance among the desired points can be maximized for side-information based demodulation at the destinations. Simulation results indicate that the DF-JM approach performs better than existing DF schemes and the denoise-and-forward (DNF) scheme in terms of the end-to-end bit error rate (BER).