For the purpose of applying to 50 GHz channel spacing 10 Gb/s DWDM systems, the dispersion reduced fiber Bragg gratings (FBG) is demonstrated. This new FBG is designed by applying in optimized cosine expansion series to the refractive index profile. The 10 π-phase shifts in the refractive index profile realize both square filtering characteristics and linear phase responses resulting in reducing group delay variation in the reflective bandwidth. The FBG, fabricated according to the new design, is tested and shows more than 30 dB isolation for the adjacent channel and less than 10 psec group delay variation in the reflective bandwidth. This small dispersion leads to vast improvement of 10 Gb/s transmission performance. The power penalty of the new FBG is suppressed to 1/6 of that of conventional FBG. Furthermore, the symmetrical refractive index profile, realized by applying a cosine expansion series, shows that these optical characteristics have no dependence of the light launching direction. From these results, this new design offers an FBG suitable for the ADM used in 10 Gb/s DWDM systems.