In this paper, an enhanced time-domain cancellation method is proposed for inter-carrier interference (ICI) reduction in OFDM systems. The conventional time-domain cancellation neglects the effect of channel variation in cyclic prefix during the time-domain cancellation and does not work well in deep fades. In order to supplement the conventional method, the simple repetition (de-)coding and the modulation order increasing are employed in the time-domain cancellation. The repetition coding provides reliable symbols in the regeneration operation, and the modulation order increasing maintains or increases the spectral efficiency. Simulation results indicate that the proposed method using 16QAM significantly improves the BER performance compared to the conventional method using QPSK, while maintains the spectral efficiency. Moreover, the proposed method using 64QAM concurrently improves both the BER performance and the spectral efficiency.