The effect of hydrogen passivation on bare and Pd capped cobalt nanocluster assembled thin films was studied with Rutherford backscattering spectrometry (RBS) and magnetic force microscopy (MFM) after exposure to ambient conditions. The nanoclusters are produced in a laser vaporization cluster source in which the helium carrier gas was mixed with hydrogen. RBS revealed that oxidation of the Co nanoclusters is considerably reduced by the presence of hydrogen during cluster formation. The capping did not modify the influence of the passivation. The hydrogen passivation method is especially effective in cases when capping of the films is not desirable, for example for magnetic studies. Clear differences in the magnetic domain structures between hydrogen passivated and non-passivated Co nanocluster films were demonstrated by MFM and are attributed to a difference in inter-cluster magnetic interaction, which is critically depending on the CoO content. The hydrogen passivation method may be used to tailor and stabilize properties of nanocluster assembled thin films. (C) 2012 Elsevier B.V. All rights reserved.