Techniques for improving the capacity of a wireless communications system using interference cancellation (IC). In an early decoding and IC aspect, a frame transmitted from a user to a base station may be decoded prior to the entire frame being received by the base station. The remaining portion of the frame may then be re-constructed at the base station prior to its reception, and cancelled from the receive signal to reduce the interference to frames received from other users. In a power control aspect for early decoding and IC, the power control target level at a local base station may be adjusted in response to successfully early decoding a frame, without affecting the overall outer loop power control operation. Further aspects include late decoding techniques for utilizing the IC of other users' signals to improve the probability of decoding a given user's frames, as well as techniques for traffic channel demodulation using channel re-estimation.