A silicon nitride (SiN) etch process selective to silicon (Si) and silicon dioxide (SiO2) for fabrication of a gate sidewall spacer was investigated using a quasi-damage-free neutral beam. In CF3I neutral beam etching, SiN can be etched selectively to SiO2 by controlling the beam energy. Etch rates of Si and SiO2 were drastically decreased by addition of O2 and H2 flow rates due to oxidation of the Si surface and decreased F flux. Reasonably high SiN selectivities of 18.6 to SiO2 and 6.2 to Si were obtained using a CF3I/O 2/H2 neutral beam. The result of the comparison between plasma etching and neutral beam etching indicated that the mechanism of this highly selective etching is unique to neutral beams without UV irradiation. By optimized neutral beam etching, SiN gate sidewall spacers were fabricated with little recess of the Si substrate. © 2013 IOP Publishing Ltd.