The capability of achieving a dispersion compensation, called prechirp technique, has been theoretically and experimentally investigated. More than two times improvement for dispersion limited transmission lengths were observed in 5 Gb/s-150 km and 10 Gb/s-50 km transmission with a semiconductor electroabsorption external modulator and a normal fiber. The allowable transmission fiber dispersion of 10 000 ps/nm and 2.5 Gb/s is estimated by computer simulation with this prechirp technique.