A process flow for forming magnetic tunnel junction (MTJ) nanopillars with minimal sidewall residue and damage is disclosed wherein a pattern is first formed in a hard mask or uppermost MTJ layer. Thereafter, the hard mask sidewall is etch transferred through the remaining MTJ layers with a RIE process comprising main etch and over etch portions, and a cleaning step. The RIE process features noble gas and an oxidant that is one or more of CH3OH, C2H5OH, NH3, N2O, H2O2, H2O, O2, and CO. Noble gas/oxidant flow rate ratio during over etch may be greater than during main etch to avoid chemical damage to MTJ sidewalls. The cleaning step may comprise plasma or ion beam etch with the noble gas and oxidant mixture. Highest values for magnetoresistive ratio and coercivity (Hc) are observed for noble gas/oxidant ratios from 75:25 to 90:10, especially for MTJ nanopillar sizes ≤100 nm.