Continued improvements in VLSI performance, circuit density and production costs are possible, in part, do to significant advances in lithography. As feature sizes get smaller, design houses are faced with either improving the resolution of their optical lithography lines, or step-up to the cost of newer x-ray based machines. The work at Rice University proposes to integrate design and process-specific CAD tools to provide further use of optical lithography equipment, while reducing feature sizes to improve manufacturability. By integrating photolithography simulators to layout editors, and by providing expert information on the simulated optical and physical resolution of the feature to the designer, compact and smaller circuits can be designated, which are governed by local design rules. This work is complemented by the development of a novel phase shifting technique at Rice based on interferometry which allows for the manufacture of features with high contrast and reduced feature size.