In this paper, fiber-optic dispersion and its effect on optical transmission system are analyzed. We investigate pre-, post-and bi-end-dispersion compensation methods for 10 Gb/s non-return to zero (NRZ) links using standard single mode fiber, non zero dispersion-shifted fiber and dispersion compensating fibers through computer simulations to optimize high data rate optical transmission. The performance characteristics like bit error rate, eye diagrams and eye height at the output are studied by simulating different systems. Apart from this, fiber Bragg grating (FBG) is also used to compensate the dispersion in optical communication link. The different simulation models for the optical transmission system are analyzed and compared using OptiSystem simulator and it is found that the compensation methods where fiber Bragg grating is used as a dispersion compensator is superior to other methods.