We use a commercially available liquid crystal television (LCTV) for encoding the on-axis phase-only filter (POF) in a real-time VanderLugt-type optical correlator. Diffraction theory, computer simulation, and optical experiments show that the coupled amplitude modulation and the phase mismatching in the LCTV yield a zero-order spot in the response of the POF and reduce the diffraction efficiency to about 60 to 70%. The correlation output of the filter is a superposition of the POF correlation peak and an image of the input. The filter, referred to as the phase-dominant filter, behaves like the POF with advantages of on-axis correlation, high light efficiency, and utilization of all the available space bandwidth product of the LCTV. Optical experimental results are shown.