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Orthogonal frequency division multiplexing (OFDM) is noted for its resistance to narrowband interference when equipped with forward error correction. This technique along with erasure insertion is adequate when the the signal-to-interference ratio (SIR) is moderate, around 0 dB, however, when the interference is severe, i.e. SIR = −20 dB, a non-orthogonal interference corrupts a large number of the data subcarriers due to spectral leakage. This situation requires a large number of erasures that compromise the code's error correction capability. The prediction-error filter (PEF) is proposed as an erasure insertion mechanism that localizes the erasures to the tones surrounding the interference, while not affecting the remaining tones. The simulation results indicate excellent performance, for the bit-interleaved coded modulated (BICM) OFDM system using the PEF and BPSK modulation when the SIR = −20 dB in a frequency-selective fading channel.