The universal forward error-correction coding system provides adjustable code rates and coding gains to greatly benefit the design of many modern digital communications (data storage) systems. The channel encoding and decoding methods are universal such that a single encoder and a single decoder can be used to implement all the forward error-correction codes of different code rates. This universal forward error-correction coding system also includes a novel systematic code generation procedure that has the capability of generating many classes of codes that provide the best balance between coding gain performance and implementation complexity.