A method of operating an optical isolator having first and second optical splitter-combiners disposed within a semiconductor die. The optical splitter-combiners are coupled together into an interferometer configuration by first and second waveguide sections also disposed in the semiconductor die. A non-reciprocal optical phase shift element is disposed within the semiconductor die. The method operates by splitting forward and backward propagating optical waves into first and second portions propagating along first and second waveguide sections of a waveguide structure disposed within a semiconductor die, injecting first and second charge carriers having opposite spin polarizations into the first waveguide section; constructively recombining the first and second portions of the forward propagating optical wave, and destructively recombining the first and second portions of the reverse propagating optical wave