(FePt) 100-x (MgO) x granular thin films were fabricated by using co-sputtering on single crystal MgO substrate at different deposition temperatures followed by a high-temperature annealing. The adding MgO was found to have the following effects: 1) high fraction of MgO phase (70 vol.%) degraded the L1 0 phase transformation; 2) FePt grains embedded in MgO matrix were well separated, leading to minimized exchange interaction between the FePt grains; 3) 55 vol.% fraction of MgO was optimal for the L1 0-FePt phase formation with highest coercivity, due to the formation of granular structure, which was also verified by comparing the structure and properties of FePt/MgO bilayer films. Deposition temperature has also effect on the magnetic properties of FePt-MgO films. Room temperature deposition did not result in the L1 0 phase even after annealing at 800°C. However, the magnetic properties of the films deposited at 200°C were better than those deposited at 300°C. The low coercivity resulted from elevated deposition temperature was attributed to the thermal expansion and competitively growth among FePt and MgO grains. The results revealed that adding appropriate amount of MgO (55 vol.%) can be achieved by finding a proper deposition temperature (200°C), well-defined granular L1 0-FePt films with fine grain distribution, high coercivity and small domain size.