In this paper, a method to suppress the impact of the nonlinear effects on an all optical orthogonal frequency division multiplexing (AO-OFDM) system is proposed. By inserting a guard interval (GI), the duty cycle of the optical signal in each symbol period of each subcarrier is decreased, thus generating a ‘zeroed’ temporal. By giving different time delays to the sub-carriers, these ‘zeroed’ temporals and optical signals of the adjacent sub-carriers are interleaved, which reduces the coincidence of the optical signals between the sub-carriers and eliminates the products of the four-wave mixing (FWM) effect to suppress the influence of the nonlinear effect on the system. The simulation results show that for an AO-OFDM system with 32 subcarriers, inserting GI and introducing different delays for each subcarrier can improve the transmission distance by 30 km or enhance the spectral efficiency by 16.7%, considering the 7% hard decision forward error correction (HD-FEC) threshold. Moreover, even when the number of subcarriers is up to 256 and the power of each subcarrier is as high as 0 dBm, our proposed signal optimization scheme can still guarantee that the BER can satisfy the 7% HD-FEC threshold.