A reduced collateral damage bomb (RCDB) bomb casing is described and disclosed along with the system and method for making it. The RCDB bomb casing may be formed from conventional or penetrating warhead bomb casings. The RCDB bomb casing has a filler material/materials disposed on the interior walls that will assist in controlling the collateral damage caused by the finished bomb but not prevent the appropriate destructive power being delivered to a selected target. Further, the fusing system may include a shaped charge to control the ignition of the main explosive charge to control the amount of collateral damage when the bomb casing is filled with high explosives.