Steam-assisted laser ablation of solid substrates is investigated. With the aid of a steam layer in dozens of microns, laser ablation with 1.5 times higher ablation rate and wider ablated crater than that in the ambient air can be achieved. Surface morphology improves greatly with three times lower protrusions along the crater edge. It implies that the laser processing speed and ablation quality can be enhanced a lot with steam assistance. Mechanisms of the ablation enhancement are studied based on plasma and shock wave confinement, heat dissipation and laser-plasma interaction during the laser ablation. Diagnostics of audible acoustic waves and plasma signals during the laser ablation in air and with steam assistance are carried out for a better understanding of the laser processing. (C) 2002 Elsevier Science B.V. All rights reserved.