An operational optical transceiver microcontroller configured to initiate a self-test using internalized loop backs. The microcontroller includes a memory, at least one processor and a number of input and output terminals. The output terminals are coupled to internally corresponding input terminals by a configurable switch. The memory receives microcode that, when executed by the processor, causes the microcontroller to close the switches so as to internally connect the output and input terminals. A signal is then asserted on the output terminal. This signal loops back and is received by the input terminal. The processor may then detect the microcontroller's response to the signal.