Recent advances in the theory and experimental realization of ferromagnetic semiconductors give hope that a new generation of microelectronic devices based on the spin degree of freedom of the electron can be developed. This review focuses primarily on promising candidate materials ͑such as GaN, GaP and ZnO͒ in which there is already a technology base and a fairly good understanding of the basic electrical and optical properties. The introduction of Mn into these and other materials under the right conditions is found to produce ferromagnetism near or above room temperature.There are a number of other potential dopant ions that could be employed ͑such as Fe, Ni, Co, Cr͒ as suggested by theory ͓see, for example, Sato and Katayama-Yoshida, Jpn. J. Appl. Phys., Part 2 39, L555 ͑2000͔͒. Growth of these ferromagnetic materials by thin film techniques, such as molecular beam epitaxy or pulsed laser deposition, provides excellent control of the dopant concentration and the ability to grow single-phase layers. The mechanism for the observed magnetic behavior is complex and appears to depend on a number of factors, including Mn-Mn spacing, and carrier density and type. For example, in a simple Ruderman-Kittel-Kasuya-Yosida carrier-mediated exchange mechanism, the free-carrier/Mn ion interaction can be either ferromagnetic or antiferromagnetic depending on the separation of the Mn ions. Potential applications for ferromagnetic semiconductors and oxides include electrically controlled magnetic sensors and actuators, high-density ultralow-power memory and logic, spin-polarized light emitters for optical encoding, advanced optical switches and modulators and devices with integrated magnetic, electronic and optical functionality.