Ion beam etching (IBE) and reactive IBE (RIBE) of GaAs and AlxGa1−xAs(x=0.3–0.5) were examined using Ar and Ar/O2(O2: 2.0 and 5.3 mol %). In Ar IBE of 100 eV or more, neither GaAs nor AlGaAs was substantially oxidized and equirate etching was observed. In 50 eV Ar/O2(2–5.3%) RIBE, however, both GaAs and AlGaAs were oxidized and etched little. In 100 eV Ar/O2(2%) RIBE, especially, AlGaAs was oxidized but GaAs was not, and a maximum selectivity of 13 was obtained in the etching of GaAs/Al0.5Ga0.5As. Impinging O+ions were found to be the main origin of oxidation.