The present invention describes a system and method of OAM diverse signal processing using classical beams for applications in which OAM signal character is controlled such as optical tagging and applications in which OAM signal character is not controlled such as clutter mitigation and interference cancellation for target detection, identification etc. This is accomplished by transmitting a source beam having a prescribed state with one or more non-zero OAM components, reflecting the beam off a `tagged` or `untagged` target and receiving the return beam in the direct return path to measure the one or more OAM components to identify the target. OAM processing provides additional degrees of processing freedom to greatly enhance the processing capabilities to detect and identify both `tagged` and `untagged` targets.