Silver zirconium nitride films deposited by unbalanced magnetron sputtering were studied by means of x-ray diffraction, transmission electron microscopy, x-ray photoelectron spectroscopy, spectroscopic ellipsometry, and nanoindentation. Coatings were deposited on silicon substrates at room temperatures with bias voltages in the -45 to -160 V range. The concentration of zirconium and silver was regulated by controlling the power to the sputtering guns. The nitrogen concentration was selected so that the nitrogen flow rate corresponded to the production of stoichiometric zirconium nitride. The films consisted of nanocrystals of zirconium nitride embedded in a silver matrix. The grain size was deduced from the width of the XRD peaks using the Scherrer formula and was found to decrease with the addition of silver. The chemical and phase composition was determined from XPS measurements. The optical constants were measured using spectroscopic ellipsometry. A correlation between film structure/composition and optical constants was established. The mechanical properties of the coatings were evaluated using nanohardness testing and were found to depend on composition and deposition parameters. Optimum mechanical properties were achieved for a silver content of 6% and a substrate bias. of - 160 V. (C) 2004 American Vacuum Society.