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This paper investigates the optimal tracking performance based on the codec, colored noise, and bandwidth constraints in the network time‐delay systems. Choosing the optimal two‐degree‐of‐freedom compensator and the dominant expression of the system optimal tracking performance is obtained after Youla parameterization by using the coprime factorizations method and spectral decomposition technology. The result shows that the tracking performance of the system is determined by the nonminimum phase zero and unstable pole of the controlled plant. Moreover, codec, colored noise, and bandwidth constraints can also significantly impact the performance. Finally, two simulation examples prove the accuracy of the theory. [ABSTRACT FROM AUTHOR]