In this paper, a modified model of Gaussian pulse propagation in optical fiber is proposed to comprehensively 
analyze the performance degradation of spectral amplitude encoding (SAE) optical code-division multiple-access 
(OCDMA) systems due to group velocity dispersion (GVD). The analytical results show that the number of supportable 
users is decreased and the maximum transmission length (i.e. the length at which BER $\leq 10^{-9}$ can be maintained) 
is shortened under the impact of GVD. For example, a system with 31$\times$1 Gbit/s users and wavelength interval 
of 0.4 nm has a maximum transmission length of 25 km when transmitted power per bit is 0 dBm. Corresponding to this 
transmission length, the system has to suffer a power penalty of 13 dB. The system's performance will be more degraded 
when wavelength interval increases. In addition, we propose a method to combat the impact of GVD, which can increase 
the maximum transmission length of SAE/OCDMA systems.