We describe an on-the-chip design of a nearly diffraction-limited broad-area semiconductor diode laser. The devices achieved single lateral mode operation as unstable resonators with magnifications between two and three. The unstable resonators were realized by focused ion beam (FIB) micromachining a diverging mirror at one of the outcoupling facets. Our modeling efforts agree well with experimental data and show that an optimum device design exists in which stable nearly diffraction-limited operation is predicted for up to six times threshold. This unstable resonator design has achieved, experimentally, the highest diffraction limited power and best external differential efficiency ever reported for any broad-area device with a curved facet.