A method and apparatus that differentially encodes and decodes data symbols in dual domains is taught. Data packets are encoded, transmitted, and decoded during a plurality of symbol intervals on a plurality of sub-carriers. Encoding and decoding are accomplished across both the time and frequency domains such that the minimum number of carrier states are employed as reference only states that do not encode a symbol of data in and of themselves. A rule of adjacency is followed, both across time and frequency, so that decorrelation is minimized. Any modulation scheme that is applicable to differential encoding and decoding can be utilized. Communication systems that couple via radio waves, through metallic conductors, or over fiber optic paths can be employed.