We report the observation of the fractional quantum Hall effect in the lowest Landau level of a two-dimensional electron system (2DES), residing in the diluted magnetic semiconductor Cd 1−x Mn x Te. The presence of magnetic impurities results in a giant Zeeman splitting leading to an unusual ordering of composite fermion Landau levels. In experiment, this results in an unconventional opening and closing of fractional gaps around the filling factor ν = 3/2 as a function of an in-plane magnetic field, i.e., of the Zeeman energy. By including the s-d exchange energy into the composite Landau level spectrum the opening and closing of the gap at filling factor 5/3 can be modeled quantitatively. The widely tunable spin-splitting in a diluted magnetic 2DES provides a means to manipulate fractional states. The fractional quantum Hall effect (FQHE) is a collective high-magnetic field phenomenon, originating from Coulomb repulsion of electrons confined in two dimensions. At certain fractional fillings, ν = p/q, of the Landau levels (LLs) (ν = filling factor, p,q = integers), quantized plateaus in the Hall resistance ρ xy and the vanishing longitudinal resistance ρ xx herald the presence of peculiar electron correlations [1,2]. Here, the electrons condense into a liquidlike ground state that is separated by a gap from the excited states. Most experiments to date have been carried out on GaAsbased systems, being still the cleanest material system with the highest electron mobilities [3]. When the direction of the magnetic field B is tilted, the orbital LL splitting is given by the field component B ⊥ normal to the two-dimensional electron system (2DES) while the total field strength B determines the Zeeman splitting E Z . Early experiments on GaAs revealed that the ν = 4/3, 5/3, and 8/5 states behaved differently upon tilting the sample [4,5]: While the ν = 4/3 and 8/5 states were undergoing a transition from a spinunpolarized state to a polarized one, the ν = 5/3 state was always fully spin polarized.Although the FQHE has been reported in quite a number of different materials [6][7][8][9][10][11][12], the FQHE has never been observed in a diluted magnetic semiconductor in which atoms with magnetic moment (e.g., Mn 2+ ) are placed in a 2DES. Then, the localized spins in the magnetic impurities' d orbitals interact with the correlated electron system via the quantum mechanical s-d exchange interaction, causing giant Zeeman splitting [13] which is tunable in magnitude, sign, and field dependence [14]. The constant αN 0 specifies the s-d exchange strength and is the largest energy scale in the system. It hence has remained unclear whether FQHE states survive in the presence of magnetic impurities. Below we demonstrate that (i) the FQHE indeed exists in magnetic 2DESs and (ii) the opening and closing of gaps in an in-plane field can be described within a modified composite fermion (CF) picture, in which the s-d exchange is taken into account.Let us first recall the CF model which maps the FQHE onto the integer quantum Hall effe...