We have developed a compact gate switch with monolithic integration of all-optical cross-phase modulation (XPM) in a Mach-Zehnder interferometer (MZI). XPM is caused by intersubband transition (ISBT) in InGaAs/AlAsSb coupled double quantum wells (CDQWs) by area-selective silicon ion implantation and rapid thermal annealing (RTA). While injecting pump light through a transverse electric/transverse magnetic (TE/TM) beam combiner, XPM is induced in one MZI arm and gating operation can be realized. The RTA condition is optimized, and the sample is annealed at 780 °C for 8 s with an implantation dose of 5 × 10(13) cm(-2). Dependence of XPM efficiency on the length of the implanted mesa is also analyzed, and there exists an optimum implantation length to fulfill both high efficiency of ISBT modulation and low loss of the probe and pump signals.