China’s semiconductor industry has reportedly developed its first domestic extreme ultraviolet lithography prototype, a technology long considered out of reach for Beijing. EUV lithography is used to manufacture the world’s most advanced computer chips and, until now, has been controlled by only one company globally, ASML of the Netherlands.
For years, the United States and its allies have worked to block China’s access to EUV technology, arguing it could be used for advanced artificial intelligence systems and military applications. The new reports show that despite those restrictions, China has made unexpected progress. According to Reuters, China has built a working EUV prototype that is now undergoing testing in a high-security laboratory.
The reported breakthrough goes further than many industry experts had predicted. Earlier this year, ASML’s chief executive Christophe Fouquet publicly downplayed China’s progress, saying the country would need “many, many years” to reach EUV-level capability. The appearance of a prototype suggests that China may be moving faster than previously believed, even if full-scale production remains years away.
EUV lithography is one of the most complex manufacturing processes ever created. The machines work by firing an extremely powerful laser at tiny droplets of molten tin. This creates a burst of extreme ultraviolet light. Engineers then carefully direct this light through a system of ultra-precise mirrors and project it onto silicon wafers. The process allows engineers to etch circuits so small they measure in nanometers. As a result, chips become faster, smaller, and more energy efficient.
ASML spent more than 17 years and over six billion euros developing its EUV technology. The company produced its first commercial systems in 2019. Each machine can cost around $250 million and fills an area the size of a small factory. Until now, no other company or country had publicly demonstrated the ability to build a comparable system.
According to the reports, China’s prototype was developed through a long-term national effort involving state research institutes, universities, and major technology firms. Semiconductor Manufacturing International Corporation, widely known as SMIC, has played a central role in advancing China’s chipmaking capabilities. The project reportedly involved studying older lithography equipment, sourcing components from global secondary markets, and applying years of domestic research.
Sources familiar with the effort say the machine is operational and can generate extreme ultraviolet light. However, engineers have not yet used it to produce working chips at scale. One source described the project as China’s version of a “Manhattan Project” for semiconductors. This description reflects the level of secrecy and national importance attached to it.
China’s government has reportedly set a target of making EUV-based chip production possible before the end of the decade. Some officials hope to see results by 2028, while others believe 2030 is a more realistic goal. Even at that pace, the timeline would be significantly shorter than the decade or more that many Western analysts previously estimated.
The development comes at a time when the global semiconductor race is intensifying due to the rapid growth of artificial intelligence. Advanced chips are now essential for data centers, smartphones, electric vehicles, and next-generation weapons systems. As demand rises, countries are investing heavily to secure their own chip supply chains.
In China, Huawei is expanding semiconductor facilities in partnership with SMIC. This move forms part of a broader push to achieve technological self-reliance. Meanwhile, in the United States, the government has committed hundreds of billions of dollars under the CHIPS and Science Act. This funding aims to rebuild domestic chip manufacturing and reduce dependence on overseas suppliers.
Despite export controls and legal actions aimed at protecting trade secrets, the reports show that China has continued to close the gap. China achieves this through persistence, funding, and talent development. ASML has previously stated that it “vigilantly guards” its intellectual property. The company has also taken legal action against alleged trade secret theft.
