Developed by researchers at Intel Labs, the transistors are just 70 to 80 atoms in width and three atoms thick, said Rob Willoner, a market analyst with Intel's technology and manufacturing group. Transistors act like tiny switches that control the flow of electrons through a chip, and Intel said its minuscule components can be turned on and off 1.5 trillion times a second, making them the world's fastest.
Intel said it will be able to cram as many as 1 billion of the transistors on a single microprocessor, boosting the speed of its chips to about 20GHz. Intel's fastest processor to date, the Pentium 4, has 42 million transistors and runs at 1.7GHz.
Intel announced its breakthrough over the weekend at a semiconductor conference in Kyoto, Japan.
The achievement is important because it suggests that semiconductor makers will be able to keep pace with Moore's Law until the end of the decade using roughly the same materials and manufacturing techniques used today, said Nathan Brookwood, principal analyst with Insight-64. Moore's Law states that the number of transistors on a chip doubles every 18 months.
"People are always getting nervous about how much more headroom silicon technology has before we run up against some fundamental limit that could cause Moore's Law to grind to a halt," Brookwood said. "What Intel is saying is that, with some work, they think they have knocked down all the brick walls between now and the end of the decade."
The transistors were developed in small quantities -- fewer than 100 to a chip -- and under artificial laboratory conditions, Willoner said. He acknowledged that Intel has several technology hurdles to cross before it can make billion-transistor chips in high volume.
"Obviously we have to make many changes, but they're evolutionary changes rather than revolutionary," Willoner said.
For example, today's lithography techniques used to burn circuits onto the surface of chips are nearing certain physical limits. Intel's engineers used tricks such as over-exposing the light to create their transistors, but that method won't be practical for volume production. Intel expects to use a technology called Extreme Ultra Violet (EUV) lithography to print its billion-transistor chips, and that method is still being developed by a consortium including Intel, IBM. Advanced Micro Devices and Motorola.
As the transistor count increases, so does the amount of heat produced, presenting another big challenge. At a chip conference in San Francisco earlier this year, an Intel executive warned that if engineers don't devise some creative methods to reduce heat put out by the chips, computer chips will have "thermal densities that are greater than a nuclear reactor."
Other issues to be addressed include improving the interconnects that link transistors together, and cutting down on electrical leakage between the tiny components, Willoner said. Nevertheless, Intel said it's confident the hurdles can be overcome.
"We've shown that we know how to do nanotechnology with silicon ... and that has clear advantages, because we know how to get silicon into volume production -- we're doing it today," Willoner said.
The tiny transistors will be used in high-performance chips that could help change the way people interact with computers, allowing for more natural speech recognition and even for body and facial gestures to be used to control PCs. The extra power may also endow computers with greater intelligence that allows them to predict what users want them to do next, based on their past behaviour or by interpreting body language, Willoner said.
The transistors will be made using a 0.045-micron manufacturing process technology, a number which refers to the size of features on the chips. Intel uses a 0.13 micron process today. Intel called its minuscule components "20-nanometer" transistors, with one nanometre being equivalent to one-billionth of a meter.
As well as being faster, the transistors also consumer less power, Willoner said. Today's Pentium 4 processors operate at about 1.7 volts, while chips built using the new technology will run at less than one volt.
Other semiconductor makers, including Motorola and IBM, are also working on ways to make chips faster.
IBM said last week that it has figured out a way to boost processor performance up to 35 percent by stretching the silicon it uses to make chips. This allows electrons to move faster through the transistors on a chip, boosting performance. IBM expects to begin using the technique, dubbed strained silicon, by 2003.