Soft x-rays have wavelengths in the range of 1–15 nm and therefore the diffraction limited spot size of focused x-rays can be as small as 1.22 × the radiation wavelength, or less than 20 nm spot size. Using our pulsed x-ray source and focusing a small collected solid angle of this x-ray radiation to a sample provides enough power to form a very hot plasma that emits a range of radiation from UV through IR that can be collected and analyzed on a conventional optical spectrometer. In addition to diagnostic capabilities the instrument can be also used as a tool to form structures at nanometer scale resolution. Since the plasma is formed by ablating the target material with x-rays the target can be patterned or nanomachined using the plasma itself. It should be possible to pattern nanoscale devices by rastering the material under the nanoplasma. Finally in analogy to plasma assisted CVD processes, organometallic vapors could introduced into the sample chamber such that the nanoplasma locally plates out specific species of metals of other materials on the target at nanoscale sizes for forming devices, circuits, wires, etc. This paper presents a design for a nanoplasma instrument, predicted performance parameters will be presented, and development issues identified and discussed.