The semiconductor foundry took off in 1990 with an annual capacity of less than 0.1M 8-inch-equivalent wafers at the 2-mm node. In 2000, the annual capacity rose to more than 10M. Initially, the technology practiced at foundries was 1 to 2 generations behind that at integrated device manufacturers (IDMs). Presently, the progress in 0.13-mm manufacturing goes hand-in-hand with any of the IDMs. There is a two-order of magnitude rise in output and the progress of technology development outpaces IDMs. What are the reasons of the success? Is it possible to sustain the pace? This paper shows the quick rise of foundries in capacity, sales, and market share. It discusses the their uniqueness which gives rise to advantages in conjunction with challenges. It also shows the role foundries take with their customer partners and supplier partners, their mutual dependencies, as well as expectations. What role then does lithography play in the foundries? What are the lithographic challenges to sustain the pace of technology? The experience of technology development and transfer, at one of the major foundries, is used to illustrate the difficulties and progresses made. Looking into the future, as semiconductor manufacturing will become even more expensive and capital investment more prohibitive, we will make an attempt to suggest possible solutions.