Ag and Ag@MgO core-shell nanoparticles (NPs) with a diameter of d = 3-10 nm were obtained by physical synthesis methods and deposited on Si with its native ultrathin oxide layer SiO x (Si/SiO x ). Scanning electron microscopy and transmission electron microscopy (TEM) images of bare Ag NPs revealed the presence of small NP aggregates caused by diffusion on the surface and agglomeration. Atomic resolution TEM gave evidence of the presence of crystalline multidomains in the NPs, which were due to aggregation and multitwinning occurring during NP growth in the nanocluster source. Co-deposition of Ag NPs and Mg atoms in an oxygen atmosphere gave rise to formation of a MgO shell matrix surrounding the Ag NPs. The behaviour of the surface plasmon resonance (SPR) excitation in surface differential reflectivity (SDR) spectra with p-polarised light was investigated for bare Ag and Ag@MgO NPs. It was shown that the presence of MgO around the Ag NPs caused a red shift of the plasmon excitation, and served Beilstein J. Nanotechnol. 2015, 6, 404-413. 405 to preserve its existence after prolonged (five months) exposure to air, realizing the possibility of technological applications in plasmonic devices. The Ag NP and Ag@MgO NP film features in the SDR spectra could be reproduced by classical electrodynamics simulations by treating the NP-containing layer as an effective Maxwell Garnett medium. The simulations gave results in agreement with the experiments when accounting for the experimentally observed aggregation.