Abstract: Polarized antennas equipped in multi-input multioutput (MIMO) systems are anticipated as space-effective alternatives. In this situation, the impacts of polarization configurations on fading correlation should be considered. A novel model with flexible polarization orientation is proposed for calculating spatial correlation. The model demonstrates that introducing of polarization reduces the spatial correlation of antennas. To maximize the performance at mobile station (MS), tradeoff between diversity gain and mean effective gain is investigated. The proposed evaluation model proves that Â±45Â° polarization at MS is always optimal, as traditionally believed. However, polarized antennas at base station (BS) also have an significant effects on system performance, especially in environment with high crosspolarization ratio (XPR). By applying Â±45Â° polarization at both ends, increment on system gain is benefited relative to polarized antennas at MS alone.