CARDIFF University has become home to some of Britain's most advanced laser technology.
The university's Manufacturing Engineering Centre (MEC) has installed the PicoLase1000 system which will allow staff to work at a minute level on "virtually any material".
The £7.5m MicroBridge facility at MEC was launched by Enterprise Minister Andrew Davies with the goal of establishing "a world centre of expertise" in nanotechnology.
This industry is predicted to be worth $1 trillion by 2015.
Oxford Lasers' Pico-Lase1000 will be used to push forward product miniaturisation and develop new manufacturing platforms for the next generation of microsystems.
Funding for the MicroBridge project was provided by the DTI, the Welsh Assembly Government and industrial partners, including Oxford Lasers.
The company's industrial division director Martyn Knowles said, "We were happy to contribute to such a worthwhile venture and will be working closely with the MEC throughout the five-year project to develop and support picosecond laser micro processing.
"We will be working with the MEC staff to provide specialist training in micro and nanotechnology."
Frank Marsh, the MEC's marketing director, said, "By producing such small components, manufacturers can save on materials, reduce component count and reduce labour - dramatically lowering overall costs and adjusting market pricing to become more competitive and increasing profits.
"The benefits from this jump in technology will be almost immediate and will have implications across a range of sectors, including communications, optics and the automotive industry."