We report generation of pulsed twin beams of light through optical parametr
ic amplification in a fiber Sagnac loop. By pumping the Sagnac loop with pi
cosecond pulses at a wavelength near the zero-dispersion wavelength of the
fiber, we achieve phase-matched nondegenerate four-wave mixing with gain. F
or a gain of 2.2, the intensity noises of the amplified signal and the gene
rated idler (conjugate) pulses are found to be correlated by 5.0 dB, and th
e subtracted noise drops below the shot-noise limit by 1.1 dB (2.6 dB when
corrected for losses). We have investigated the gain dependence of the quan
tum-noise reduction as well as of the intensity noises of the amplified sig
nal and idler pulses. As the gain increases, we observe the onset of excess
noise on the idler pulses. (C) 2001 Optical Society of America.