  We demonstrate an optical-fiber based source of polarization entangled
photon-pairs with improved quality and efficiency, which has been integrated
with off-the-shelf telecom components and is, therefore, well suited for
quantum communication applications in the 1550 nm telecom band. Polarization
entanglement is produced by simultaneously pumping a loop of standard
dispersion-shifted fiber with two orthogonally-polarized pump pulses, one
propagating in the clockwise and the other in the counter-clockwise direction.
We characterize this source by investigating two-photon interference between
the generated signal-idler photon-pairs under various conditions. The
experimental parameters are carefully optimized to maximize the generated
photon-pair correlation and to minimize contamination of the entangled
photon-pairs from extraneously scattered background photons that are produced
by the pump pulses for two reasons: i) spontaneous Raman scattering causes
uncorrelated photons to be emitted in the signal/idler bands and ii) broadening
of the pump-pulse spectrum due to self-phase modulation causes pump photons to
leak into the signal/idler bands. We obtain two-photon interference with
visibility $>90$% without subtracting counts caused by the background photons
(only dark counts of the detectors are subtracted), when the mean photon number
in the signal (idler) channel is about 0.02/pulse, while no interference is
observed in direct detection of either the signal or the idler photons.
