High quality epitaxial thin films of YBa2Cu3O7 have been deposited on single-crystal MgO(001) substrates by 355 nm Nd:YAG laser ablation. Through a systematic optimization of the deposition parameters, it was found that for a target-substrate distance of 30 mm, the optimal laser intensity, substrate temperature, and deposition oxygen pressure were 300 MW/cm2, 750 ° C, and 0.5-1.0 mbar, respectively. Microstrips with dimensions down to 10 μm across were fabricated using both a photoresist technique and laser ablation through a metal mask. The superconducting transition takes place over 1 K, and the critical temperature is reproducible within ±1.5 K, the best result being Tc,0 = 90 K. The highest critical current density measured on a 10 X 0.15 μm2 strips was 4 X 106 A/cm2 at 77 K . Film patterning using laser ablation through a metal mask was studied in detail to investigate the applicability of this method. Etch rates as a function of laser intensity were measured, and the process was followed in situ by on-line monitoring of the film resistivity. © 1990.