With 10G time division multiplexed passive optical network (TDM-PON) systems ready for massive deployment worldwide, the next generation PON standards are being intensively discussed in both IEEE and ITU-T. Compared with the IEEE’s wavelength stacked 2 ∗ 25 G solution, the ITU-T’s single carrier non-return-to-zero-based 50G TDM-PON has the advantages of low cost, easy operation, and convenient management. However, the 50G TDM-PON will also have to face great challenges in real-world operating conditions. In this paper, we will illustrate the unique role for digital signal processing (DSP) in solving the challenges for the next generation 50G TDM-PON systems, such as device bandwidth limitation, dispersion induced power penalty, and high link budget. To analyze DSP’s feasibility in this application, potential issues such as cost and interoperability are analyzed. Through offline experiments and prototype demonstrations, DSP’s role in enabling next generation single carrier 50G TDM-PON is highlighted.