Photonic integrated circuits in silicon require waveguiding through a material compatible with silicon very large scale integrated circuit technology. Polycrystalline silicon (poly‐Si), with a high index of refraction compared to SiO2and air, is an ideal candidate for use in silicon optical interconnect technology. In spite of its advantages, the biggest hurdle to overcome in this technology is that losses of 350 dB/cm have been measured in as‐deposited bulk poly‐Si structures, as against 1 dB/cm losses measured in waveguides fabricated in crystalline silicon. We report methods for reducing scattering and absorption, which are the main sources of losses in this system. To reduce surface scattering losses we fabricate waveguides in smooth recrystallized amorphous silicon and chemomechanically polished poly‐Si, both of which reduce losses by about 40 dB/cm. Atomic force microscopy and spectrophotometry studies are used to monitor surface roughness, which was reduced from an rms value of 19–20 nm down to about 4–6 nm. Bulk absorption/scattering losses can depend on size, structure, and quality of grains and grain boundaries which we investigate by means of transmission electron microscopy. Although the lowest temperature deposition has twice as large a grain size as the highest temperature deposition, the losses appear to not be greatly dependent on grain size in the 0.1–0.4 &mgr;m range. Additionally, absorption/scattering at dangling bonds is investigated before and after a low temperature electron‐cyclotron resonance hydrogenation step. After hydrogenation, we obtain the lowest reported poly‐Si loss values at &lgr;=1.54 &mgr;m of about 15 dB/cm. ©1996 American Institute of Physics.