The temperature dependence of the growth of cobalt on Ag(100) has been studied with scanning tunneling microscopy. For submonolayer coverage, the preferred sites of nucleation change with increasing temperature from a random distribution over the terraces to decoration of the silver steps on the upper side. Because of the step decoration, the silver surface, which has propagating steps at elevated temperatures, is frozen into a stable configuration. Numerical analysis of island densities gives an estimation of 0.6(2) eV for the diffusion barrier for cobalt on Ag(100). Higher deposition temperatures result in the formation of a surface alloy. For higher coverages, however, high-temperature deposition or post-annealing after room-temperature deposition does not lead to a cobalt film completely covering the silver surface, but to the formation of clusters embedded in irregular-shaped silver terraces. An explanation is given in terms of a competition between the surface for energy and the heat of mixing. (C) 2000 Elsevier Science B.V. All rights reserved.