A smoke and fire detection system wherein a central controller transmits data to remote transponders on a voltage supply line by pulse code modulation (PCM) of the supply voltage, and the transponders communicate with the controller by pulse width modulated (PWM) current pulses over the voltage supply line. A transmitter in the controller supplys a nominal operating voltage to the transponders and transmits a data word comprising a plurality of data bits to the transponders over the line. The transmitter generates each data bit by switching the voltage supplied to the line from the nominal operating voltage to a first voltage corresponding to a first logical level or a second voltage corresponding to a second logical level. A decoder in each transponder derives the transmitted data word. The decoder detects each data bit by detecting the transition from the nominal voltage to the first or second voltages, and the decoder determines the logical level of each bit by measuring the transmitted voltage level immediately after detecting the transition. The transponder returns data to the controller in the form of data signals, each data signal having a duration based on the data to be returned. With such arrangement, the transponders do not require a clock or other timing circuitry to communicate with the controller. Also, the controller may vary the data rate or bit duration without interfering with the operation of the transponders.