An area efficient novel optical modulator with low operation voltage is designed based on integrated Mach-Zehnder Interferometer with a photonic crystal slab structure as the phase shifter. Plasma dispersion effect is utilized so that photonic band-to-band transition occurs at the operating frequency leading to a high index change (Δn = ~4) for π-phase shift on the modulator. This approach reduces the phase shifter length to a few micrometers (~5 µm) in a silicon on insulator platform and operating voltage required is around 1 V. Low voltage together with short optical interaction length decrease optical losses and power consumption during modulation process providing a great opportunity for size and system cost optimization.