An automated drilling and fastening system is under development at the GEMCOR Engineering Corporation for wing manufacture on a new commercial airframe program. It is the first time that cold-working and hole inspection have been integrated into an automated fastener installation system. Numerical control and monitoring of all process parameters have been integrated in the system to achieve the greatest degree of accuracy and repeatability in fastener installation and to provide real-time, in-process statistical quality control.An integral component of the system is a capacitance probe used to measure the diameter and profile of drilled holes. Measurement information obtained with the hole probe is used to monitor the drilling process and predict tooling wear.This paper briefly discusses fastener hole requirements and the effects of hole quality on fatigue life. An overview of the capacitance measurement technique is also presented. Inspection design goals and the integration of the Capacitance Measurement System (CMS) in the automatic system are presented.