The number of users and data capacity of wireless systems are increased by employing apparatus and method for increasing the number of spreading codes available in the system by providing a mechanism to reuse the already allocated spreading code or use the codes that may correlate to those already being used within the same sector/cell. This, in return, provides capacity improvement proportional to the number of added base station (BS) antennas for each cell. An antenna null steering technique for code allocation maintains the cross correlation properties of the codes only for the desired user and to obtain a gain in capacity improvement.