Though immersion lithography is on the verge of starting mass-production, demerit in overlay controllability by immersion is thought as one of last huddle for that. The first issue in immersion tool has not been matured compared to dry tool. As design rule is getting smaller, overlay specification is also changing the same way. But immersion tool is not ready to meet this tighter overlay specification. The second issue is regarding the material which is used for immersion process: top coat and water. Process details of material are needed to be verified thoroughly about how each parameter affect on alignment and overlay respectively. In this paper, we made a split experiment about machine parameter and investigated top coat effect on overlay. To improve overlay performance of immersion, we analyzed machine parameters: scan-speed, settling time, UPW(Ultra Pure Water) flow etc. And we made an experiment about how the effect of top coat is appeared on overlay through simulation and experiment. In the experiments, we used ASML 1400i scanner. Resolution improvement of immersion tool has been proved by lots of papers, but it is need to be verified of overlay controllability that getting tighter. Continuously, we believe that most efforts are to be focused on overlay control issue.