The sputter parameters of Permalloy for the magnetic poles of thin film heads are optimized. The experiments are carried out in a standard RF diode system with RF bias. Argon nitrogen mixtures are used as sputter gas. The anisotropy field strength Hkkeeps relatively constant for all parameter variations, whereas the coercivity drops when the nitrogen content of the sputter gas is raised from 0 % to more than 1 %. The saturation magnetostriction λsis very sensitive on the target composition. Changing from 76.6 to 82.4 wt % Ni causes a λsvariation from +5×10-6to -2.5×10-6. Higher bias voltages result in more negative λsvalues. Additionally λscan be controlled over a relatively wide range (about 1.6×10-6) by the nitrogen content (0-5 %) of the sputter gas. About 1.3 wt % in composition of the target can be compensated by this nitrogen doping. X-ray investigations show that the different values are caused by composition variations in the film. Depending on whether /λs/< 1×10-6or /λs/ > 1×10-6mainly two different types of domain structures were observed on patterned pole structures.