In this work, we are reporting on a lithography-based methodology and automation in the design of Program Defect masks (PDM’s). Leading edge technology masks have ever-shrinking primary features and more pronounced model-based secondary features such as optical proximity corrections (OPC), sub-resolution assist features (SRAF’s) and phase-shifted mask (PSM) structures. In order to define defect disposition specifications for critical layers of a technology node, experience alone in deciding worst-case scenarios for the placement of program defects is necessary but may not be sufficient. MEEF calculations initiated from layout pattern data and their integration in a PDM layout flow provide a natural approach for improvements, relevance and accuracy in the placement of programmed defects. This methodology provides closed-loop feedback between layout and hard defect disposition specifications, thereby minimizing engineering test restarts, improving quality and reducing cost of high-end masks. Apart from SEMI and industry standards, best-known methods (BKM’s) in integrated lithographically-based layout methodologies and automation specific to PDM’s are scarce. The contribution of this paper lies in the implementation of Design-For-Test (DFT) principles to a synergistic interaction of CAD Layout and Aerial Image Simulator to drive layout improvements, highlight layout-to-fracture interactions and output accurate program defect placement coordinates to be used by tools in the mask shop.