The use of two-wave mixing in photorefractive (PR) materials in a homodyne detection receiver structure is studied. The interaction between a strong local oscillator optical field and a weak signal optical field in the PR material results in the formation of a volume index of refraction phase grating. The grating automatically aligns such that it coherently couples the signal and local oscillator fields just like a fixed beamsplitter in a conventional homodyne receiver structure. The slow response of the PR material automatically compensates for slow changes in the angle of arrival of the signal beam but acts as a fixed grating with respect to rapid phase modulation of the signal beam. The performance of a homodyne receiver that uses a PR material as a beamsplitter, is shown to be up to 3 dB superior to the performance of a conventional homodyne receiver that uses a fixed 50-50 beamsplitter. Furthermore, a PR receiver can adjust and retain its optimal performance when changes in the received signal power occur, whereas a conventional receiver cannot.