Lattice strain and defect formation in oxygen implanted silicon (SIMOX) were investigated as a function of dose and annealing conditions by high resolution x-ray diffraction and transmission electron microscopy. X-ray rocking curves revealed the presence of two distinct strained layers. Self-interstitial clusters and oxygen interstitials gave rise to a buried strain layer in unidirectional tension centered around the projected range at low doses (l×1016 and 3×1016 cm−2. As the dose was increased to 1×1017 and 3×1017 cm−2 a supersaturation of vacancies near the surface produced a second strain layer with a unidirectional lattice contraction at the wafer surface. Annealing at 900°C, 0.5 hr. reduced this surface strain as the defects coarsened into observable cavities. The development of cavities upon annealing was used in a sequential implantation and low temperature annealing process to produce low threading dislocation density SIMOX. Possible mechanisms for threading dislocation formation are discussed.