(Co-Fe)-Al-O soft magnetic thin films were fabricated by cosputtering Co-Fe alloy and Al2O3 ceramic targets using an inductively coupled RF (radio frequency) sputtering system. The microstructure and magnetic properties of various (Co-Fe)/(Al-O) thin-film compositions were systematically characterized. A specimen with the composition (Co72Fe17Al11)-O exhibited excellent high-frequency magnetic properties, with a value >300 for the real part of the permeability and >2 GHz for the self-resonant frequency. High- resolution transmission electron images revealed nanometer-order Al2O3 amorphous phases separating the Co-Fe alloy nanograins. The excellent high-frequency magnetic properties were derived from the particular microstructure of these thin films.