Growth of nanowires and etching of a substrate can be undertaken simultaneously as found during the silver droplet assisted growth of InxGa1−xAs nanowires (NWs) on Ge (100) substrates by metal organic chemical vapor deposition technique. The growth direction of free standing NWs has been found to be controlled by the size of the silver nanoparticles (AgNP). Vapor–liquid–solid growth of vertical free standing NWs on Ge (100) substrates has been found possible when the average AgNP size is 180 nm without any surface treatments or nucleation steps under experimental precursor flow rates and temperature. The NWs are found to grow in 〈011〉 and 〈111〉 direction with 120 nm average catalyst size and below that size, the AgNPs are found to etch the Ge surface instead of growing NWs. Two different kinds of etching have been observed. AgNPs of 20 nm size selectively etch the Ge (100) surface resulting in inverted pyramidal holes whereas larger AgNPs do not show any selective etching characteristics, rather create cylindrical holes. The switchover from growth to etching in smaller droplet size regime has been attributed to Gibbs–Thompson effect. The results prove the efficacy of AgNPs for simultaneous nanopatterning and nanostructure growth on Ge (100) surface.