Electroplated Cu(Ag) alloy thin films are potential candidates for future electronic devices in terms of lifetime and reliability compared to copper as the state of the art interconnect material. In the present paper we focus on the microstructure of Cu(Ag) alloy films considering the grain evolution as well as silver incorporation and segregation. We show that Ag alloying addition prevents room temperature recrystallization. Thermally induced grain growth occurs mainly between 180 degrees C and 330 degrees C. Silver can be incorporated as solid solution into the Cu matrix by up to 0.8 at.% after annealing and even in higher concentrations in the as-deposited state, which is significantly above the equilibrium solubility limit. Precipitations are formed by the continuous mode and can be mainly found at the film surface but also inside the Cu(Ag) grains as ball-shaped particles. Based on our results a reliability improvement is expected by mechanical strengthening due to alloying effects while maintaining a low electrical resistivity and a {111} fiber texture. (C) 2011 Elsevier B.V. All rights reserved.