A contact lithography alignment system and method use nanoscale displacement sensing and estimation (nDSE) to maintain an alignment and compensate for a disturbance of one or more objects during contact lithography. A method of maintaining an alignment includes establishing an initial alignment of one or more objects and employing nDSE-based feedback control of relative positions of more or more of the objects to maintain the alignment during contact lithography. A method of disturbance compensation includes acquiring a first image, acquiring a second image, estimating an alignment error using nDSE applied to the first and second image, and adjusting a relative position to reduce the alignment error. A contact lithography system includes an optical sensor, a feedback processor providing nDSE and a position controller that adjusts relative positions of one or more objects to reduce an alignment error determined using the nDSE.