Effects of adding group VIII transition metals (Fe, Co, and Ni) to an aluminum target on electrical resistivity and hillock suppression of sputter-deposited Al alloy films were studied. It was found that the group VIII transition metals and Al formed a complete series of metastable solid solutions in the as-deposited state. The solid solutions were decomposed into intermetallic compounds, and the microstructures of the Al alloy films changed during annealing up to 300 degrees C. The electrical resistivities of Al-Fe, Al-Co, and AI-Ni alloy films changed corresponding to the change in their microstructures, and markedly decreased to 5.0 mu Omega cm at the precipitation points. The film stresses also changed corresponding to the change in the microstructure of the Al alloy films, and were abruptly relieved by precipitation of intermetallic compounds and grain growth. Since Al-Fe, Al-Co, and Al-Ni alloy films did not yield, they are highly resistant to hillock formation. The low electrical resistivity and the excellent resistance to hillock formation of Al-group VIII transition metal alloy films were explained on the basis of microstructural changes before and after annealing.