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Following the FCC's auctions for local multipoint distribution service spectrum, the US spectrum holders are expected to go on a rapid move, first toward evaluating the technology in trials, and further toward gradual deployment and commercial availability. The LMDS spectrum will offer new ways to break the local loop bottleneck by delivering a full suite of high-speed service interfaces to business and residential customers. The problem for developers and operators consists in how to efficiently exploit the wide amount of available spectrum for LMDS against challenges such as the propagation characteristics, and the availability and cost of radio technology at millimeter waves. This article presents some of the alternatives and options related to the efficient deployment of LMDS. It starts with a presentation of the duplexing techniques and their specific trade-off and applicability in LMDS. Further on, we consider the subject of frequency planning and reuse. This consists of an overview of the basic mechanisms and algorithms involved, links to related topics in mobile cellular systems, and architectures for reuse optimization in LMDS. Of special interest is the issue of LMDS deployment for gradual capacity upswing, starting with low investment in equipment and a low number of cells and sectors, and going toward more cells with higher capacity per cell. To serve this problem a novel approach to the use of alternative polarization in gradually increasing capacity and sectorization is presented. To justify the target of high capacity and bandwidth utilization, an example of capacity estimation is also given.