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This work presents an experimental study on the improvement of pulsed diode laser gain-switched (GS) optical sources where simultaneous compression and reshaping of the low-quality pulses obtained with this technique are reported. These effects are achieved using a highly nonlinear optical loop mirror (HNOLM) directly coupled to the diode laser source without any previous pulse conditioning. The HNOLM is based on the use of a microstructured optical fiber and a highly nonlinear semiconductor optical amplifier. This system is compact and robust. The pulses have been characterized through the evaluation of their autocorrelation traces and a study using a temporal information via intensity algorithm. Results show that the loop improves the quality of complex GS pulses in several aspects: they are compressed, their symmetry is improved, and the width and height of the pedestals that commonly appear accompanying GS pulses are reduced. The system proposed offers overall benefits in terms of reduced system complexity.