In broadband transmission over troposcatter paths, selective fading will be encountered with resultant transmission impairments, depending on the modulation method. An analysis has been made in a companion paper of such selective fading, based on an idealized model of troposcatter paths. It indicated that selective fading will be accompanied by phase nonlinearity which in a first approximation can be regarded as quadratic over a narrow band. A probability distribution for such quadratic phase distortion was derived. On the premise of quadratic phase distortion, the error probability owing to selective fading was determined for digital transmission by various methods of carrier modulation. The same idealized model and basic premise of quadratic phase distortion is used here to determine intermodulation distortion in FM for a signal with the statistical properties of random noise. An approximate expression for intermodulation noise owing to specified quadratic phase distortion has been derived, applying for any method of frequency pre-emphasis in FM. In turn, median intermodulation noise as well as the probability distribution of intermodulation noise has been determined, as related to certain basic system parameters. A comparison is made of predicted with measured intermodulation noise in four troposcatter systems with lengths from 185 to 440 miles. The results indicate that phase nonlinearity owing to selective fading can be approximated by quadratic phase distortion, or linear delay distortion, over an appreciable part of the transmission band ordinarily considered for troposcatter systems, with a probability distribution that can be determined from certain basic parameters of troposcatter links, such as the length and antenna beam angles. However, to predict intermodulation distortion on any system, further experimental data than are now available are required on beam broadening by scatter. The present random multipath FM distortion theory is shown to afford