A novel and simple non-return-to-zero differential phase shift keying (NRZ-DPSK) wavelength division multiplexing (WDM) system, which can simultaneously demultiplex and demodulate multiple wavelengths, is proposed and investigated in this paper. The phase-to-intensity demodulation principle is based on detuned filtering, which is achieved by using a single commercial array waveguide grating (AWG) in our scheme. By properly choosing appropriate AWG channels at the transmitter, the AWG at the receiver can act as both the demultiplexer and the demodulator of the DPSK signals. Simulations at 10, 20, and 40 Gbit/s show good flexibility and performance for the proposed system.