Scanning tunneling microscopy (STM) and the magneto-optical Kerr effect (MOKE) have been used to investigate the effects of annealing on the morphology and magnetism of Fe and Ni films on Cu(100). Relatively mild annealing (490 K) created pinholes in the Fe/Cu(100) films, opening channels for the surface diffusion of copper to the top of the film surface along the walls of the pinholes. The magnetization of the Fe films is strongly affected by annealing. Annealing smooths the surface of Ni/Cu(100) films significantly, but no interdiffusion was observed upon annealing below 500 K. For Ni films thicker than 7 ML, the magnetization remains perpendicular after annealing, with only a slight reduction in its amplitude.