by ʇolɐǝz ǝɥʇ qoq

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I've read here on this very site that some compact cameras don't use aperture blades to stop down the lens and limit the amount of light hitting the sensor. Stopping down increases diffraction. Instead, these cameras use neutral density filters for this purpose.

How are these implemented? Are they dropped in the light path like drop-in filters on large telephotos, or is there a LCD panel that's activated when needed?

This question is inspired by my answer to this question.

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And, do such cameras lie in their metadata and claim a different f-stop? – mattdm Aug 9 '11 at 20:57
@mattdm - Yes they do. The F-stop is adjusted to reflect the reduced light transmission. – Itai Aug 10 '11 at 14:36
up vote 6 down vote accepted

They are simple ND filters which simply slide in an out of the optical path.

You will notice that those cameras only offer two (or four for double ND filters) apertures at any given focal length. That is because they have a fixed attenuation unlike polarizing filters.

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