The effect of surface oxide layers on thermally induced hillock formation was examined in AlTa and AlCu alloy films. An anodic oxide or a sputter-deposited oxide layer was intentionally formed on the top of the Al alloy films, and subsequently annealed in a vacuum of less than 1 x 10(-4) Pa. Hillock formation on the encapsulated films, the dependence of hillock density on types and thickness of the oxides, and film stresses were investigated. It was observed that hillocks preferentially formed under the oxides and extruded out of the films, breaking through them. SEM and cross-sectional TEM micrographs revealed hillock growth along with the oxide/metal interface and deformation of the surface oxides following the change of surface topography by hillock formation, More than 100 nm in thickness of anodic oxide caps or a 230-nm thick sputter oxide were necessary to suppress hillock formation. An identical hillock density was obtained in each Al alloy film with encapsulation up to 62 nm in thickness, independent of the thickness and type of the oxide cap. The results indicate that surface conditions are unlikely to determine hillock density, and hillock suppression in the encapsulated films was presumably achieved by lower film stresses at elevated temperature resulting from higher initial tensile stresses induced by anodization and a smaller gradient of the stress-temperature curve of the metal/oxide multilayered films.