Physical AI Topic Announcement.pdf

NSF-Topic3-FY26-XLabsPhysicalAI

AI FOR PHYSICAL SYSTEMS

TOPIC ANNOUNCEMENT FOR THE NSF X-LABS INITIATIVE

1.0 Purpose:

The National Science Foundation (NSF) Directorate for Technology, Innovation and Partnerships (TIP) announces its intent to solicit Written Proposals for NSF X-Labs teams in the technical domain of physical AI. This NSF X-Labs announcement is issued under the Other Transactions Agreement Solutions Offering (OTASO), NSF-OTASO-FY26-XLabsInitiative.

2.0 The NSF X-Labs Initiative:

NSF X-Labs represent a bold, flexible, and outcomes-driven initiative designed to build and accelerate novel platform technologies capable of unlocking entirely new sectors, including new fields of scientific inquiry. The program will support full-time research and development (R&D) teams focused on use-inspired scientific breakthroughs and foundational platform technologies that traditional university and industry labs cannot easily address. NSF X-Labs teams will benefit from ambitious R&D goals, operational autonomy, milestone-based funding, and the ability to engage across academia, industry, national laboratories, and nonprofit sectors. NSF X-Labs will bet on ambitious, full-time teams working with urgency and purpose, and provide them with the structure, resources, and flexibility necessary to cultivate early-stage platform technologies that will accelerate breakthroughs and unlock entirely new sectors of the economy.

See Section 3 of NSF-OTASO-FY26-XLabsInitiative or the latest amendment issued for information on the NSF X-Labs initiative’s strategic objectives.

2.1 NSF X-Labs Topics and Missions

NSF will release specific Topic areas under the NSF X-Labs initiative via Topic Announcements. Topics will center on fields of research where breakthroughs could create or reshape entire scientific fields and technology sectors where U.S. competitiveness is a priority.

Proposing teams will specify their Mission, defined as the novel platform technology and key use-inspired research solutions that the proposed NSF X-Lab is uniquely suited to tackle.

Missions must align with a current Topic Announcement released by NSF. Proposing teams should have a clear vision of how their Mission will result in an end-state that creates or reshapes an entire field of scientific research or sector of technology, and how their Mission is currently unmet by existing organizational structures and funding mechanisms.

3.0 Topic Description:

Decades of progress in AI algorithms, robotics, sensing, and embedded computing, combined with accelerating industry investment, have positioned the U.S. to redefine how intelligent systems interact with the physical world. While digital AI has advanced rapidly, the next frontier requires developing intelligent, adaptive, and scalable systems capable of perceiving, acting and learning directly within complex physical environments with adaptive human-robot interaction.

Achieving this vision demands innovations in foundational platform technologies to support situational adaptability, continuous learning, and right-sized simulation-to-reality systems.

Imagine heterogeneous autonomous swarms in military and disaster triage environments capable of high-stakes collective decision making in collaboration with human counterparts and the situational adaptability to perform complex locomotion, sensing, and targeted delivery tasks. Or bio-inspired robotics that operate with adaptive sensing for reflexive sensor input control, neuromorphic cognitive efficiency, and self-healing materials and behaviors. These advances demand significant, continual, and cross-disciplinary ecosystems to save lives, and catalyze U.S.

technological and economic innovation.

NSF X-Labs teams will target early-stage platform technologies that enable breakthroughs to accelerate entirely new forms of AI integration in physical systems including advanced sensors, robotics, embodied systems, human-robot interfaces, or cyber-physical systems. Examples of relevant Missions include, but are not limited to: technologies to enable new forms of distributed learning and swarming; adaptive behavior in the absence of connectivity; novel algorithms for sensor integration into digital twin or cyber-physical simulations; new capabilities in edge AI for physical systems; new modalities for AI control of emerging robotics such as bio-inspired or bio-hybrid components; platforms to support the next generation of robotic manufacturing based on mass-customizability and intuitive learning; and breakthroughs in the development of training data that, together with other advances, prepare physical AI systems for real-world variability including interactions with human counterparts. The resultant innovative platform technologies should benefit a broad range of application domains critical to U.S. competitiveness and security, which may include healthcare, national defense, emergency response, advanced manufacturing, and scientific discovery.

An NSF X-Labs Mission in this Topic must be transformative, accelerating breakthrough R&D in physical AI towards creating or reshaping new lines of research and technologies. Successful teams will develop platform technologies, overcome technical barriers facing AI for physical systems, demonstrate measurable impact on the U.S. science and technology landscape, and position their technologies for widespread use and investment. Teams proposing to this Topic must justify that their proposed Mission will develop a technology not presently supported by existing R&D investments by the U.S. public or private sector.

Examples of challenges not considered in scope for this Topic include computational or software solutions without practical integration into a physical system, integration of current technologies without significant advancement of the state-of-the-art, development of technologies where the impact is narrow and not widely deployable, fundamental research without potential for application in platform technologies, incremental advancement of the state-of-the-art, or advancement of technologies that are already appropriately developed to the point of full-scale commercialization.

4.0 Other Transaction (OT) Award Details:

In response to this Topic Announcement, NSF anticipates issuing one or more Other Transaction (OT) contracts pursuant to NSF’s statutory authority at 42 U.S.C. § 19116. Refer to NSF-

OTASO-FY26-XLabsInitiative or latest amendment issued for more information on period and place of performance, instrument and approach, eligibility, performance objectives for NSF X- Labs teams, programmatic phase structure, milestones and milestone-based payments, Written Proposal format and instructions, Oral Proposal Packages, NSF selection criteria, and the review and selection process. Proposers are expected to closely review NSF-OTASO-FY26- XLabsInitiative, including its latest amendment, before submitting a Written Proposal in response to this Topic Announcement.

An eligible organization can submit a maximum of two Written Proposals per Topic Announcement for Phase 0 as a lead organization. Senior/Key Personnel may be listed on a maximum of one Written Proposal per Topic Announcement.

5.0 Topic Timeline:

NSF anticipates awarding selected teams a 9-month Phase 0 with a Go/No Go selection period beginning after 7 months. NSF anticipates awarding teams selected for Phase 1 an approximately 24 to 36 month period of performance with the intention of renewing high performing teams for Phase 2 following subsequent Go/No Go selections.

NSF anticipates the following schedule for OT awards made in response to this Topic Announcement:

Written Proposal Submission Deadline January 7, 2027; 5:00 p.m. Eastern Beginning of Phase 0 July 2027 Beginning of Phase 1 Go/No Go Selection February 2028 Beginning of Phase 1 April 2028

6.0 Submission Details:

The NSF X-Labs initiative involves a two-step competitive evaluation, as described in NSF- OTASO-FY26-XLabsInitiative. NSF will accept Written Proposals in response to this Topic Announcement and then invite a smaller number of proposing teams to submit an Oral Proposal Package and deliver an oral presentation. All Written Proposals submitted in response to this notice must comply with the content and format described in Section 10 of NSF-OTASO-FY26- XLabsInitiative or the latest amendment issued.

Questions concerning this Topic Announcement may be submitted to the Government through 5:00 p.m. Eastern on November 16, 2026 to be included in a frequently asked questions (FAQ) document posted to SAM.gov. Questions must be submitted as an email attachment using the provided question submission template (Attachment C) to XLabs@nsf.gov. The subject line of any submitted questions must include the topic title: NSF-Topic3-FY26-XLabsPhysicalAI. NSF anticipates that not all submitted questions may receive a direct answer.

Written Proposals will not be accepted after 5:00 p.m. Eastern on January 7, 2027. Proposals must be submitted electronically via the NSF submission website at https://nsfgov.my.site.com/xlabs.

https://nsfgov.my.site.com/techlabs

NSF may share proposal information with other Federal research funding agencies for the purposes of considering potential co-funding. Prior to that occurring, NSF will contact individual vendors for permission to share its proposal information outside of NSF.

7.0 AI for Physical Systems NSF X-Labs Webinars:

Join the NSF TIP team for a webinar, including a brief presentation on key materials in the OTASO and Topic Announcement. A Q&A will follow the presentation. Respondents are recommended to review NSF-OTASO-FY26-XLabsInitiative and this Topic Announcement before the webinar to maximize the effectiveness of the Q&A session.

Q&A Webinar for NSF X-Labs – AI for Physical Systems October 14, 2026 at 1 p.m. Eastern Register here: https://nsf.zoomgov.com/webinar/register/WN_TbJX8dRbRwy7H8q1S8rYNg https://nsf.zoomgov.com/webinar/register/WN_TbJX8dRbRwy7H8q1S8rYNg