In the past decade, atomic force microscopy (AFM) has become a powerful technology for nanofabrication due to its low cost, simplicity in operation, and unique atomic-level manipulation capabilities. Although a wide range of nanoscale components, devices, and systems have been fabricated by AFM, three major challenges in the further enhancement of its capability, reliability and productivity are still remaining in AFM nanofabrication. In this paper, following an overview of the recent advances in AFM nanofabrication technology, the recent efforts made to cope with these challenges are examined and the potential challenges on further capability advancement, especially on those processes having tips loaded with multiple energy sources, are discussed. Then, specific approaches for improving the repeatability by equipment automation and for enhancing its throughput or productivity by parallel processing and speed increasing are evaluated and the potential improvements are suggested. Finally, concluding remarks summarizing the major challenges and the potential solutions in AFM fabrication are included. (C) 2011 Elsevier Ltd. All rights reserved.