The characteristics of an optical functional integrated circuit and its applications are discussed. This circuit is based upon a Mach-Zehnder interferometer type waveguide device employing thermo-optic effect. This circuit is compact, cost-effective and practical. One proposed application is an optical loopback circuit to test both OCU loop 1 and DSU loop C. This optical loopback circuit with an attenuator and space switches is formed on a common silicon substrate, and using this circuit both loopback and line tests are independently available at the same access point. The other is an optical selector. This optical selector with WDM-MUX/DMUX and space switches is formed on a common silicon substrate, and using this selector, wavelength selection from medium density WDM (MDWDM) signal can be performed. Each MDWDM signal carries both AM and FM-FDM video signals modulated by Subcarrier Multiplexing (SCM) techniques. This selector can be wired in point-to-multipoint configurations to home video appliances.