In this paper we will present the progress that has been made in the area of tool development for ArF Immersion. The local fill nozzle design adopted by Nikon is explained together with the bubble free and low defect imaging results obtained. We report imaging results from our immersion exposure tools, demonstrating the impressive imaging results we have achieved on 65nm (half-pitch) technology and below, however we also report the need for improvement. A practical path for immersion tool implementation is reported together with the first tool likely to be capable of true 45nm line/space manufacturing using an lens NA of 1.30.