In this paper we discuss the mechanism by which process variations determine the overlay accuracy of optical metrology. We start by focusing on scatterometry, and showing that the underlying physics of this mechanism involves interference effects between cavity modes that travel between the upper and lower gratings in the scatterometry target. A direct result is the behavior of accuracy as a function of wavelength, and the existence of relatively well defined spectral regimes in which the overlay accuracy and process robustness degrades (`resonant regimes'). These resonances are separated by wavelength regions in which the overlay accuracy is better and independent of wavelength (we term these `flat regions'). The combination of flat and resonant regions forms a spectral signature which is unique to each overlay alignment and carries certain universal features with respect to different types of process variations. We term this signature the `landscape', and discuss its universality. Next, we show how to characterize overlay performance with a finite set of metrics that are available on the fly, and that are derived from the angular behavior of the signal and the way it flags resonances. These metrics are used to guarantee the selection of accurate recipes and targets for the metrology tool, and for process control with the overlay tool. We end with comments on the similarity of imaging overlay to scatterometry overlay, and on the way that pupil overlay scatterometry and field overlay scatterometry differ from an accuracy perspective.