The present disclosure provides a polarization multiplexed transceiver, including: a transmitter; a receiver; circuitry within the transmitter configured to insert pilot tones as a reference state of polarization for a polarization multiplexed signal; and circuitry within the receiver configured to de-multiplex the polarization multiplexed signal using the pilot tones. The transmitted signal is constructed in such a manner as to facilitate the division of the receiver processing between the analog and digital domains such that the implementation may be simultaneously both highly spectrally efficient and power efficient.