The phase development and defect formation during the silicidation reaction of sputter-deposited Er films on Si with ∼20-nm-thick Ta and TaN capping layers were examined. TaN capping effectively prevented the oxygen incorporation from the annealing atmosphere, which resulted in complete conversion to the ErSi2-x phase. However, significant oxygen penetration through the Ta capping layer inhibited the ErSi2-x formation, and incurred the growth of several Er-Si-O phases, even consuming the ErSi2-x layer formed earlier. Both samples produced a number of small recessed defects at an early silicidation stage. However, large rectangular or square-shaped surface defects, which were either pitlike or pyramidal depending on the capping layer identity, were developed as the annealing temperature increased. The origin of different defect generation mechanisms was suggested based on the capping layer-dependent silicidation kinetics.