Ion beam etching produces a modified layer at the surface of silicon which subsequently affects the electrical characteristics of devices fabricated on these surfaces. In this investigation it is shown that the modified layer resulting from low‐energy ion beam processing contains a fundamental defect which has the signature of a trivalently bonded, silicon defect center. The evolution of the signature of this defect with ion beam energy and anneal history correlates with the evolution of the current‐voltage characteristics of metal contacts made to the modified layer.