The next step needed to achieve higher neutron yields and improved neutron production efficiency with Inertial Electrostatic Confinement (IEC) sources requires operation with an external ion source so that the reaction chamber pressure is controlled separately for the source pressure. This paper presents recent progress in IEC research at the UIUC using a unique external ion source ILLIBS (Illinois Ion Beam Source). When filled with deuterium, the IEC provides ~108 2.5-MeV D-D fusion neutrons/sec at steady-state. The design and operation of a radiofrequency (RF) ion gun designed for this purpose is also discussed.