In this paper we discuss the physical mechanism and the critical factors for the dislocation generation in device processing. The mechanisms of the stress development are identified. Elastic stress is estimated from the convergent beam electron diffraction (CBED) measurements using transmission electron microscopy (TEM), and the defect generation is monitored by electrical measurements of a specific monitor structure. The implantation conditions and the implantation damage recovery is shown to be another key factor in the defect generation. Thermal oxidations of the STI structure are shown to be a major responsible of the stress increase. In addition to the process the pattern geometry strongly affects the mechanical stress. Minimum geometry structures with a complex layout are prone to defect generation.