Modified fused silica is the primary candidate material for 157-nm photomask substrates. Standard UV excimer grade silica, such as Corning HPFSR, does not transmit below about 175- nm because of its high OH content. In contrast, we have prepared fused silicas with low OH contents and low levels of fluorine with measured transmissions up to 73.8%/6.4 mm and internal transmittances up to 87.9%/cm at 157-nm. Refractive index measurements at 157-nm are presented from which we calculate a theoretical limit for the measured transmission (reflection losses only) of about 88.5% at 157-nm. Modified fused silica is shown to have high resistance to laser-induced color center formation. The thermal and mechanical properties of modified fused silica are shown to be similar to those of standard excimer grade fused silica but not identical. For example, the thermal expansion and Young's Modulus of modified fused silica are slightly lower than that of Corning HPFSR, while thermal conductivity is the same. Modified fused silica substrates have been shown to behave similarly to standard fused silica substrates in mask-making processes such as polishing and Cr film deposition. In summary, our property and process results support the selection of modified fused silica for the 157-nm photomask application.