Microstructure, magnetic and optical properties of polycrystalline Fe-doped ZnO films fabricated by cosputtering with different Fe atomic fractions (x(Fe)) have been examined systematically. Fe addition could affect the growth of ZnO grains and surface morphology of the films. As x(Fe) is larger than 7.0%, ZnFe2O4 grains appear in the films. All the films are ferromagnetic. The ferromagnetism comes from the ferromagnetic interaction activated by defects between the Fe ions that replace Zn ions. The average moment per Fe ion reaches a maximum value of 1.61 mu(B) at x(Fe) = 4.8%. With further increase in x(Fe), the average moment per Fe ion decreases because the antiferromagnetic energy is lower than the ferromagnetic one due to the reduced distance between the adjacent Fe ions. The optical band gap value decreases from 3.245 to 3.010 eV as x(Fe) increases from 0% to 10%. Photoluminescence spectra analyses indicate that many defects that affect the optical and magnetic properties exist in the films. (C) 2009 Elsevier B. V. All rights reserved.