As the technology of lithography extending to 10 nm and below process nodes in advanced semiconductor manufacturing, lithography has put forward high requirements for the precision of overlay, and the corresponding alignment accuracy has reached sub-nanometer level. In this paper, a new alignment technique using Moire fringes based on self-coherence in lithographic tools is presented. The principle is that the same diffraction order beams from the alignment mark of the phase grating are split and image-rotated by using optical structure of alignment system. Two groups of interference fringes with different periods are formed on the image plane of the alignment system. The two group of interference fringes are further interfered and superimposed to form self-coherence Moire fringes. The two interference fringes move toward opposite direction when the alignment mark position is displaced, and this displacement of the alignment mark can be enlarged. The position measurement accuracy of the alignment mark is improved. The Fourier transform and phase extraction are carried out by self-coherence Moire fringe image, and the position of alignment mark is got by the analysis of its phase information. Simulation results show that the alignment accuracy and the alignment repetition accuracy can reach 0.07 nm and 0.11 nm respectively.