Abnormal inline defects were caught after nitride spacer etching processes. Detailed MEBES layout checking and inline SEM inspection revealed that such defects always appeared at the boundaries in between PFETs and NFETs regions. The microstructure and chemical composition of the defects were analyzed in detail by various TEM imaging and microanalysis techniques. The results indicated that the defect possessed core-shell structure, with oxide core and nitride shell. Based on the TEM failure analysis results and manufacturing processes, we conclude that the defects originated from PR fencing due to the PR hardening during PFET and NFET LDD/Halo implantation. The oxide core was generated during oxide spacer formation using an ozone-TEOS process, which was responsible for the nitride spacer under-etch issue.