The wireless communications industry has experienced tremendous growth worldwide in the past decade. Numerous cellular communication systems have been developed to meet this need. In North America, AMPS, IS-54, 1S-95 and GSM are the most popular cellular systems ruling the market. In developing nations, Wireless Local Loop (WLL) services will be in great demand in the coming years. While some service providers may adapt existing cellular standards to this application, WLL does not require the support for mobility which is available in a full cellular system. As a result, substantial cost savings may be obtained through dedicated WLL implementations. In this thesis, a new wireless communication system is investigated. The system combines the low cost and flexibility of analog frequency modulation with the capacity and multipath advantages of a Code Division Multiple Access (CDMA) system. This system aims to provide WLL telephone services at low cost, with wireline grade voice quality, fast infrastructure deployment and ease of planning. In this thesis, a theory for FM/CDMA system performance is established. Closed form analytical expressions of signal to multiple. access interference ratio are obtained using both upper bounds and lower bounds. The hybrid system is also optimized for the optimum combination of modulation index and processing gain. In addition, a software test-bed is developed to model different FM demodulation schemes, evaluate the tradeoff of FM modulation index versus CDMA processing gain and the system robustness, compare the forward link and the reverse link system performance and investigate the effect of power control schemes. / Master of Science