We report on the structural evolution and the magnetic behavior of the Co/Ag multilayered films deposited in a UHV chamber at room temperature, submitted to 10 min thermal annealing at temperatures ranging from 100 to 600 degrees C. The structural characterization was performed using X-ray diffraction and X-ray absorption spectroscopy techniques. Magnetoresistance and magnetization measurements were used to study the evolution and magnetic behavior of the samples. The results show that, besides the roughness;It the interfaces and the structural disorder of the Co layers, the as-deposited sample has a compressive stress at Ag-Co interface originated by the difference between the surface energies of Ag and Co. After annealing at 400 degrees C, there is a breakup of the layers accompanied by a relaxation of the stress and defects as well as partial crystallographic ordering of the Co clusters. The room-temperature magnetoresistance change from anisotropic magnetoresistance to giant magnetoresistance with a sharp maximum, reaching 4.5%. (C) 1998 Elsevier Science B.V. All rights reserved.