Data are presented on step‐graded separate confinement quantum well lasers with Al0.85Ga0.15As outer confining layers, AlxGa1−xAs barriers and a 50‐A˚ GaAs quantum well grown by metalorganic chemical vapor deposition. By varyingxbfrom 0.15 to 0.60, we show that, given an adequate optical waveguide confinement factor and sufficient cavity length, the collection of electrons in thin quantum wells with either direct or indirect barriers can be highly efficient, transfer of electrons from indirect barriers to thin direct wells does not degrade laser performance, and electron confinement in the separate confinement region plays no role in the operation of the laser.