A method for forming a field oxide isolation regions of a memory array is described. The field isolation regions comprise a rectangular array of oxide islands. The oxide islands are formed by a two mask process wherein the first mask is a LOCOS hardmask which defines an array of parallel field oxide stripes. The field oxide stripes are thermally grown by a LOCOS oxidation process. A second mask, which has an array of parallel stripes perpendicular to the field oxide stripes is then patterned over the wafer. The stripes of the second mask expose a plurality of narrow sections of the field oxide stripes which are then etched by a directional plasma etch having a high selectivity of silicon oxide over silicon. The anisotropic etch segments each of the longer oxide stripes into a string of islands space apart by a narrow gap through which a robust common source line passes unencumbered by birdsbeak oxide. The edges of the field oxide at the gap have vertical walls and square corners which afford improved spacing of components in the vicinity of the gap. The method eliminates the need for a mask bias to accommodate corner rounding and birdsbeak oxide encroachment which occurs if the islands are defined by a single mask process.