Gold nanoparticles embedded in a dielectric matrix (SiO2) were prepared by a hybrid technique combining plasma-enhanced chemical vapor deposition and pulsed DC sputtering. The concentration and spatial distribution of the metal particles were controlled by deposition parameters, while particle size and size distribution were further adjusted by annealing. Subsequently, the nanocomposite samples were exposed to an energetic ion beam (30 MeV), a treatment that has been shown to transform spherical particles to high aspect ratio ellipsoids. The films were studied in detail by spectroscopic ellipsometry and spectrophotometry, and their optical response was correlated with their microstructural features such as particle alignment in the ion beam direction, as documented by the blue shift of the surface plasmon resonance (SPR). We show that such process is reversible in a sense that subsequent annealing of ion beam-irradiated particles red shifts the SPR to the initial position. (c) 2004 Elsevier B.V. All rights reserved.