The saturation magnetostriction λsof thin Permalloy films, used in magnetoresistive reproduce heads, has to be strictly controlled to be negative and less than 3×10−7. The value of λsfor NiFe is a strong function of film composition. [E. Klokholm and J. A. Aboaf, J. Appl. Phys.52, 2474, (1981).] [R. M. Borzorth and J. G. Walker, Phys. Rev.89, 624 (1951).] Since the composition of the target material could be controlled to only ±0.2% of Ni, the potential changes in λscould have been as large as 6×10−7, which exceeded the material specification. Therefore, the effect of substrate bias (0 to −60 V), sputtering pressure (2 to 20 mTorr), and target voltage (200 to 1000 V) on magnetostriction has been investigated to identify the best process control parameter. Sputtering has been performed in an argon atmosphere using a triode source. The target was vacuum cast NiFe. Thermal oxide‐coated Si wafers were used as a substrate. It was found that the substrate bias has a strong effect on λs; however, the thickness uniformity becomes unacceptable. The target voltage has been found to have no effect on magnetostriction. The value of λshowever, can easily be modified by varying the sputtering pressure. Varying the pressure from 4 to 10 mTorr can change λsas much as 4×10−7without degradation of the other film magnetic properties, such as anisotropy, coercivity, and magnetoresistance. Therefore, this method has been successfully used in control of λsin our thin‐film magnetoresistive heads.