NiFe films in the thickness range of 300 Å to 8 μm with excellent magnetic properties and thickness uniformity have been prepared using a newly developed high rate (up to 1000 Å/min) dual ion beam sputtering system. Deposition conditions such as the ion assist voltage, the target orientation and the partial pressure of nitrogen have been optimized to reduce coercivity Hc and stress as well as to improve film adhesion and film thermal stability. The annealing effects on Hc, the anisotropy field H k, as well as the resistivity of the NiFe films were studied. X-ray diffraction and transmission electron microscopy techniques were used to characterize the microstructures of the films and were correlated with their magnetic properties. These ion-beam sputtered NiFe films have excellent magnetic, electrical, mechanical, and microstructural properties to make them suitable for thin-film head applications.