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This paper investigates the impact of transceiver noise on the performance of digital back-propagation (DBP). A generalized expression to estimate the signal-to-noise ratio (SNR) obtained using DBP in the presence of transceiver noise is described. This new expression correctly accounts for the nonlinear beating between the transceiver noise and the signal in the optical fiber transmission link. The transceiver noise-signal nonlinear beating has been identified as the main reason for the discrepancy between predicted and practical performance of DBP; which has not been previously suggested. This nonlinear beating has been included in the GN model, allowing DBP gains in practical systems to be predicted analytically. Experiments and split-step simulations with and without polarization-mode dispersion (PMD) in the transmission link have been performed. The results show that the impact of transceiver noise …