An investigation correlating grain size, resistivity, and magnetoresistive ratio with annealing of multilayer magnetic thin films was performed in this dissertation;Two basic categories of devices, utilizing this magnetoresistive property of magnetic thin films, are being studied in our laboratory. These categories are computer memory cells and magnetic field sensors. The particular type of field sensor being considered is the read transducer in magnetic recording thin film head;As these devices are fabricated smaller and smaller, approaching submicron dimensions, demagnetizing effects become a major influence affecting device performance. The particular structure under study is composed of two ferromagnetic (outer) layers separated by a nonferromagnetic middle layer. This configuration results in a decrease of the undesirable demagnetizing fields (compared with a single layer structure) due to flux closure at the edges;A ternary alloy, Ni[subscript]65Fe[subscript]15Co[subscript]20, rather than Permalloy, Ni[subscript]81Fe[subscript]19, was used for the magnetic layers in order to have a higher magnetoresistive ratio;The principal purpose of this study was to compare and improve the magnetic properties, especially the magnetoresistive ratio, of the multilayer films through before deposition and after deposition annealing. We observed that the magnetoresistive ratio increased after either type of anneal, resistivity decreased accordingly, and grain size increased.