Abstract: Oriented Co nanoparticles were obtained by Co ion implantation in crystalline ZnO thin films grown by pulsed laser deposition. Transmission electron microscopy revealed the presence of elliptically shaped Co precipitates with nanometer size, which are embedded in the ZnO thin films, resulting in anisotropic magnetic behavior. The low-temperature resistance of the Co-implanted ZnO thin films follows the Efros-Shklovskii type variable-range-hopping. Large negative magnetoresistance (MR) exceeding 10% is observed in a magnetic field of 1 T at 2.5K and the negative MR survives up to 250K (0.3%). The negative MR reveals hysteresis as well as anisotropy that correlate well with the magnetic properties, clearly demonstrating the presence of spin-dependent transport. (C) 2013 AIP Publishing LLC.