The invention combines fluorescent QDs and methods to dispense and detect them efficiently in a compact volume for a range of optical tagging applications. Micro-fluidic devices are used for mixing water-soluble fluorescent QDs in aqueous solutions to create a multi color fluorescent nano-optical tag, and gratings are used for spreading the spectral components of the fluorescent signal leading to an improvement in optical data storage capacity over prior art methods. The spectral signature of the tag is detected by a compact read-out head with a grating spectrometer. One way is to dispense the tag within the pits of a DVD or CD using an ink-jet nozzle and exciting them by a large range of wavelengths each shorter that the emission peak. The filters have a high immunity to prolonged exposure to high temperatures, and up to 41 infrared filters can be holographically recorded by spatial multiplexing of the substrate.