Magnetic recording media used today are based on sputtered cobalt alloy films with thicknesses in the order of 50 nm. As recording density is increased, the microstructure of the film must be controlled with increasing level of sophistication to achieve the magnetic properties necessary for good recording performance. Recording density has been increasing at the compound annual rate of 30%, and in recent years at a higher rate. Already, 1 Gb/in2 has been achieved in the laboratory [1], and 10 Gb/in2 is being contemplated [2]. In order to achieve such densities, microstructural characteristics such as grain morphology, size distribution, crystallographic orientation, and grain separation must be controlled with great precision, and their relationship to magnetic properties must be understood. The paper will describe the effect of sputter process conditions and the selection of magnetic alloys on the film microstructure and describe what might be required to achieve high recording densities. Particular attention will be paid to grain size distribution and grain separation. Grain separation is important for low noise performance of the media. Alloy selection and sputtering conditions can be manipulated to achieve different levels of separation between the grains.