By combining the technology of all-optical saturable absorbers and the diffractive optics, a scheme of all-optical time division demultiplexing module is investigated. Following authors' proposal, design, test fabrication of the optical platform in the previous paper, this paper focuses on the characterization of switching performance. Using a multiple quantum well saturable absorber of InGaAs/InAlAs composition, and gain switched semiconductor laser pulses of 25 ps pulse width, the switching function was demonstrated experimentally at wavelength of 1.55 µm. The switching on-off ratio was compared among 4 lens configuration, 2 lens configuration (2L) and free space, collinear geometry. No degradation was observed in the case of 2 lens configuration in comparison to collinear illumination. Thus the feasibility of all-optical switch module with power efficiency and high speed is predicted, under the assumption of the progress in sub-micron lithography.