A method and system for averaging the effects of polarization distortions across a multitude of transmitted data streams in a dual polarization multiplexed optical communications system. Data streams are interleaved amongst each other in accordance with a predetermined pattern. The interleaved data streams are symbol mapped and modulated to provide a pair of optical signals. The pair of optical signals are orthogonally polarized, and multiplexed for transmission across an optical fibre. A receiver circuit receives the transmitted signal and extracts the interleaved data streams. The interleaved data streams are de-interleaved to generate the original data streams. While the data streams can be interleaved and transmitted via a single wavelength optical signal, the data streams can be interleaved and transmitted over two or more different wavelength optical signals to further mitigate the effects of polarization distortions.