In optical interferometry, homodyne signifies that the reference radiation (i.e. the local oscillator) is derived from the same source as the signal before the modulating process. For example, in a laser scattering measurement, the laser beam is split into two parts. One is the local oscillator and the other is sent to the system to be probed. The scattered light is then mixed with the local oscillator on the detector. This arrangement has the advantage of being insensitive to fluctuations in the frequency of the laser. Usually the scattered beam will be weak, in which case the (nearly) steady component of the detector output is a good measure of the instantaneous local oscillator intensity and therefore can be used to compensate for any fluctuations in the intensity of the laser.
Homodyne and heterodyne techniques are commonly used in thermoreflectance techniques.
In radio technology, the distinction is not the source of the local oscillator, but the frequency used. In heterodyne detection, the local oscillator is frequency-shifted, while in homodyne detection it has the same frequency as the radiation to be detected. See direct conversion receiver.