A GaInAsP/InP laser (&lgr;g=1.3 &mgr;m) on grooved substrate with a lens‐shaped active layer, in which the current blocking junction is grown exclusively outside of the groove, has been fabricated by single‐step liquid phase epitaxy. This technique is based on the preferential growth effects of InP and GaInAsP on the (100) oriented substrate with [011¯] directed grooves. Under cw operation, low threshold current (38 mA), high output power (40 mW/facet), and high external differential quantum efficiency (56%) are accomplished; fundamental transverse mode operation up to an output of 30 mW/facet is verified. These successful characteristics are realized by the introduction of the inner current confining layer.