In this paper we study laser diode parameters in fiber optic communication system and we study the relationship between them. The capacity of optical communication systems is rising exponentially in order to follow the rapidly increasing demand for data traffic. Limitations due to dispersion and non-linearity in the optical fiber become more stringent for higher bit rates.. In optical communication transmitters are light sources, receivers are light detectors and the channels are optical fibers. In optical communication the channel i.e., optical fiber plays an important role because it carries the data from transmitter to the receiver. Laser is a powerful source of light having extraordinary properties which are not found in the normal light sources like tungsten lamps, mercury lamps, etc..Laser surgery has also provided itself to be a preferred tool of operation over standard tools in a lot of the cases.