Telecommunications transport networks have to face the fast development of Internet-based data communications. Wavelength Division Multiplexing (WDM) is a key enabling technology to satisfy this huge increase of traffic. In order to improve the flexibility and the survivability ofthese WDM transport, the introduction of optical routing techniques is foreseen during the next decade. In this context, the availability of reliable and cost-effective optical cross-connects (OXC) is a critical issue. Two main functions may be performed in these nodes, namely the spatial routing of the wavelength demultiplexed channels and the wavelength conversion of these channels. Many architectural options can be envisioned for OXC'3. In all cases, the performance and the cost of the space-switching technology used in OXC are key factors for the realization of these nodes. Among the different technologies under development for space routing in OXC the actually most advanced are optomechanical and thermo-optic switches4. But, in spite they are commercially available, the capacity of these devices is strongly limited. In this context, free space routing is an attractive solution because it could enable to benefit from the large theoretical capacity provided by two-dimensional beam deflection techniques. Moreover, the holographic approach which has yet proven its efficiency5 can be performed by using nematic liquid crystals (NLCs) gratings which may operate with infra-red wavelengths. These components take advantage ofthe rather good maturity ofNLC technology thanks to the display industry, including recent progresses in high resolution microdisplays. We present here our results in the perspective of developing large capacity switching matrices based on high efficiency twodimensional liquid crystal gratings. After a short review of the present state-of-the-art of electrically addressed liquid crystal gratings, we describe the approach followed in order to achieve accurate and continuous deflection angles, which is a strong requirement when interconnecting single mode fibers. We demonstrate that parallel aligned NLC devices can procure the blazed-profile phase needed for high efficiency routing. This approach is supported by experimental results obtained both with transmissive or reflective cells. The problem of the switch dimensioning with either 1 -D or 2-D deflectors, is then addressed. We emphasize the requirements in terms of electrical interconnection technology arising from the large number of electrodes (at least 1,000 I dimension), this analyze leads us to suggest the LC/VLSI technology. Then, we present our work for the development of a 8x8 capacity system based on 1-D deflection, including the adaptation of the LC process on Silicon and test-circuit evaluation results.