A new kind of SILO (sealed interface local oxidation of silicon) processing for VLSI isolation has been explored. In this SILO process, an LPCVD Si 3N 4 film (about 50 nm) is deposited directly onto the silicon surface. Then N 2 + ions are implanted into the Si 3N 4 film. This N 2 + ion implantation can not only effectively reduce the tensile stress of the Si 3N 4 film, but also mix the native SiO 2 between silicon and the Si 3N 4 film. SEM results show that the birds' beak is greatly reduced by choosing proper implanting energy. The stress of the Si 3N 4 film is studied by the flatness measurement using Canon 500 laser scanning flatness measuring equipment and the Si/Si 3N 4 interface properties are analysed by AES. MOSFETs using the SILO process have also been fabricated.