We investigate a high capacity WDM-PON based on wavelength locked Fabry-Perot laser diodes. An error-free transmission of 1.25 Gb/s per subscriber was achieved with a flat-top passband AWG and a laser diode with low reflectivity. Then, we demonstrate a WDM-PON of 40-Gb/s capacity of 32 channels over 15 km of single mode fiber. It also shows that color-free operation within conventional C-band wavelength. The observed dispersion penalty after 30 km transmission was 0.5 dB. The demonstrated WDM-PON shows a robust transmission performance on the optical back reflection. (C) 2008 Optical Society of America.