A new approach for large‐scale semiconductor laser fabrication is presented. In this ‘‘full‐wafer processing and testing’’ concept, the mirrors are fabricated, not by cleaving the wafer but by forming them by means of a chemically assisted ion beam etching process. This allows for on‐wafer mirror passivation and testing of the finished devices.Full‐wafertechnologychanges the traditional way of discrete device fabrication and testing to a method more akin to today’s very large‐scale integrated (VLSI) technology. Consequently, it provides similar advantages in cost and throughput. Additionally, it allows other electrical and electro‐optical device components to be monolithically integrated on the wafer. Currently, we are routinely fabricating AlGaAs/GaAs diode lasers with a single quantum well graded index separate confinement heterostructure (SQW‐GRINSCH)‐type ridge structure using full‐wafer technology. Such lasers exhibit excellent beam properties in single mode up to at least 50 mW output power. Their functional characteristics are indistinguishable from comparable lasers with cleaved facets obtained from the same wafer for comparison purposes. This result reflects the high quality of the etched mirrors. Typically, their surface roughness is less than 200 Å, with mirror reflectivities of about 30% and losses due to mirror scattering below 2%. Having functional parts on the uncleaved wafer allows automated full‐wafer testing that encompasses wafer characterization and part screening. This not only eliminates part handling, with its associated yield loss, it also permits a much expanded scope of testing in a fraction of the time previously required.