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Compact arrays such as multiple antennas on a mobile terminal suffer from low efficiency and high correlation between antenna signals. In the present paper, a simple and rigorous procedure for decoupling two closely coupled antennas with a parasitic scatterer is proposed. The parasitic scatterer, which can be an additional antenna, acts as a shield between two active antenna elements. In contrast to previous studies involving the use of parasitic scatterer for decoupling antennas, we demonstrate using antenna impedances the underlying decoupling mechanism for two arbitrary antennas. By a proper choice of parameters, perfect matching and decoupling can be obtained for a given antenna spacing without extending the overall area used, and without introducing additional decoupling networks. The price to pay is a reduction of bandwidth relative to that of widely spaced antennas, which is the case for other decoupling methods as well. Simulation and experimental results are used to substantiate the effectiveness of the proposed design approach on a two-monopole array with an antenna spacing of 0.1 wavelength. Finally, several practical considerations of the proposal are also presented, including the extension of the approach for more than two active antennas and its implementation in mobile terminals.