Pulse position modulation (PPM) is introduced downstream of the reflective semiconductor optical amplifier (RSOA)-based single-fiber full-duplex bidirectional wavelength division multiplex passive optical network (WDM PON) to suppress the interference brought by the remodulation effect in the RSOA, Rayleigh backscattering, and reflection of the connection devices. In addition, because of the power-efficient characteristic of the PPM-encoded signals, the power budget shows clear improvement. As the experimental tests indicate, with ~6 dB extinction ratio (ER) in the downstream signal, the receiving sensitivity of the PPM-encoded channel is ~2.6 and ~3 dB higher than that of the NRZ (Non-return to zero)-encoded channel in the downlink and uplink, respectively.