We apply a level set formulation to the problem of surface advancement in a two-dimensional topography simulation of deposition, etching, and lithography processes in integrated circuit fabrication. The level set formulation is based on solving a Hamilton-Jacobi type equation for a propagating level set function, using techniques borrowed from hyperbolic conservation laws. Topological changes, corner and cusp development, and accurate determination of geometric properties such as curvature and normal direction are naturally obtained in this setting. The equations of motion of a unified model, including the effects of isotropic and unidirectional deposition and etching, visibility, surface diffusion, reflection, and material dependent etch/deposition rates are presented and adapted to a level set formulation. The development of this model and algorithm naturally extends to three dimensions in a straightforward manner and is described in part II of this paper (in press).