Co-sputtering has been used to manufacture nanocomposite thin films of Si and Ag particles embedded in amorphous SiO2 and Si matrices respectively. A combination of transmission electron microscopy(TEM), Rutherford backscattering spectrometry(RBS), energy dispersive microanalysis (EDS) and UV-VIS spectrophotometry has been used to characterize the microstructures, compositions and optical behaviour of the nanocomposite thin films. In co-sputtered nanocomposite Si-SiO2 and Ag-Si films, the Si and Ag particles are typically 4-20nm in size.