The paper investigates the performance of digital pulse interval modulation (DPIM) in the presence of multipath propagation and additive white Gaussian noise. To combat intersymbol interference (ISI), guard slots and a nonlinear equaliser have been introduced. The average optical power requirements (AOPR) due to ISI for cases with/without guard slots and with equaliser are analysed using a ceilingbounce model. Results obtained show that in the absence of equalisation, DPIM without guard slot offers a lower AOPR compared with on–off keying (OOK). Introducing guard slots gives a further reduction in AOPR by up to 4 dB due to the reduced duty cycle of the DPIM signal. The performance of DPIM without guard slot but using an equaliser is found to be significantly better than DPIM with guard slots on a channel with severe ISI.