Semiconductor laser diode (LD) coherent light source coupling is critical to integrated optic (IO) performance. Direct external coupling of conventional (CD layer) LDs is often inefficient, introduces noise, and is generally counter to the IO micro-concept. Two options are suggested; fiber optic coupling to the IO chip aperture and integration (hybridization) of micro-LDs within the IO chip itself. Selection of the optimal LD for integration into IOs depends on a variety of parameters specific to the IO application. As an example, laboratory displacement measurements were carried out with a conventional (780 nm) edge emitting LD externally attached to an IO Michelson interferometer (IOMI) chip at the waveguide aperture. Measurement error analysis identifies errors and suggests how digital, thermal, electronic, and optical source errors can be minimized through electronic design and micro-LD components. Characteristics of LDs, VCELS and ring-laser didoes, such as threshold current, operating voltage, thermal effects, mode structure, loss mechanisms, and related coupling characteristics are compared. Recommendations for improving analog/digital conversion and software methods, as well as applications of vertical cavity surface-emitting lasers and semiconductor ring lasers coupled to IO chips are discussed.