In this study, the authors propose a novel collaborative multi-user transmission and detection scheme for the uplink of code-division multiple access (CDMA) that exploits the differences between users' fading channel signatures to increase the user capacity well beyond the spreading length in multiple access interference (MAI) limited environment. The authors show that it is possible to achieve this increase at a low complexity and high bit error rate (BER) performance in flat fading channels, which is a major research challenge for overloaded CDMA systems. In this approach, instead of using one sequence per user as in conventional CDMA, the authors group a small number of users to share the same spreading sequence and enable group spreading and despreading operations. The proposed collaborative multi-user receiver consists of two stages: group multi-user detection (MUD) stage to suppress the MAI between the groups and a low complexity maximum-likelihood detection stage to recover jointly the co-spread users' data using minimum Euclidean distance measure and users' channel gain coefficients. The scheme is investigated analytically and by extensive simulations and comparisons with conventional CDMA, overloaded CDMA using group pseudo-decorrelation (G-PD) and layered space-time (LAST) MUD. It is shown that the total number of full-rate users supported by the scheme is substantially higher than the available sequences. Moreover, it achieves much lower complexity and significantly improved BER for the same user capacity compared with G-PD. It is also shown that, with antenna diversity reception, collaborative CDMA considerably outperforms LAST scheme, particularly when more transmit antennas per group than available receive antennas are employed.