An efficient and low-cost optical alignment technique is established for the first time for compact transmitter optical sub-assemblies (TOSAs) with an integrated multiplexer based on free space optics (FSO) for 100 and 400 Gbps Ethernet (GbE) applications. A compact FSO system for the 100 GbE TOSA is fabricated in a compact package 6.5 × 15.1 × 5.6 mm in size to confirm the validity of the technique. It is demonstrated by experiment that the optimum optical alignment condition can successfully be figured out by this technique without any expensive equipment, which has been a significant issue for TOSAs with integrated FSO systems, confirming the validity of the technique. Further, Monte Carlo simulations show that the optical output power distribution across the lanes is compatible with the 100 GbE LR4 specification, indicating the suitability of the proposed low-cost alignment technique. It is also shown that the acceptable long-term power variation required for reliability is predicted owing to the relaxation of the positional tolerance of the collimator lenses, which is obtained by the proposed technique. Finally the feasibility of the technique is discussed for 400 GbE TOSAs with eight-lane optical systems.