The impact of crosstalk in an arrayed-waveguide (AWG) on an optical add-drop mul-tiplexer(OADM) is investigated. The OADM constitutes of m add/drop channels and n-pass channels. Theoretical analysis shows that the singal-to-noise ratio QCT of the OADM increases as either N or m is nonlinear degraded. Number of channels in a network based on OADM's is limited by crosstalk in the AWG router.