Abstract— In frequency division duplex transceivers the transmit signal is leaking through the duplexer into the receive branch. For the case of Zero-IF receivers the nonlinearity of the I/Q down converter generates 2nd order intermodulation products of the Transmitter Leakage, causing severe interference to the desired receive signal in the baseband. In this paper we present a Stochastic Gradient Least Mean Square algorithm based on a linear approximation to compensate digitally the interference caused by Tx Leakage in the baseband of the receive branch. Simulation results are used to evaluate the impact of Tx Leakage on the system performance. Furthermore they point out, that the Least Mean Square compensation algorithm significantly improves the system performance and gets very close to the maximum achievable performance using this linear approximation.