Device applications of nonlinear optical phenomena on the silicon-on-insulator platform are attracting significant attention in silicon photonics. We report a novel on-chip Mach–Zehnder interferometer-type serial-to-parallel converter aimed at all-optical label processing of optical packets. We focus on the free-carrier dispersion effect during phase modulation of the serial probe signal, and a pump signal is used to generate sufficient free-carriers within the waveguide structure. By leaving out a delay between the pump and probe pulses, we avoid the effects of pump-induced cross-phase modulation and two-photon absorption, and perform serial-to-parallel conversion at a lower pump power. In the theoretical analysis, serial-to-parallel conversion of a 10-Gbps probe signal is considered. By numerical simulations, the shortest arm length of the Mach–Zehnder interferometric structure required for operation is calculated. When doing so, the pump pulse width and delay between the pulses are varied while the pulse energy of the pump is held constant at 25 pJ, and the combination of values that corresponds to the shortest arm length is taken as optimum values. Our study reveals that the optimum values for delay and pump pulse width are 30 ps and 25 ps, respectively. Finally, we also demonstrate single-bit serial-to-parallel conversion experimentally on a Mach–Zehnder interferometric device. Phase modulation due to free-carrier dispersion was observed at peak pump power levels of 1.0 W at the waveguide input.