The effect of lateral composition modulation, spontaneously generated during the epitaxial growth of an AlAs/InAs short-period superlattice, on the electronic band structure is investigated using phototransmission and photoluminescence spectroscopy. Compared with uniform layers of identical average composition, the presence of the composition modulation considerably reduces the band-gap energy and produces strongly polarized emission and absorption spectra. We demonstrate that the dominant polarization direction can selectively be aligned along the 
or  crystallographic directions. In compressively strained samples, the use of (001) InP substrates slightly miscut toward (111)A
or (101) resulted in modulation directions along  or , respectively, and dominant polarization directions along a direction orthogonal to the respective composition modulation. Band-gap reductions as high as 350 and 310 meV are obtained for samples with composition modulation along  and , respectively. Ratios of polarized intensities up to 26 are observed in transmission spectra. © 2000 American Institute of Physics.