The annealing effects on magnetism, structure, and ac transport for Co:ZnO films have been systematically investigated. The room temperature saturation magnetization (M-s) varies drastically with Ar or Ar/H-2 annealing processes. By using the impedance spectra, the change in grain boundary and grain defects of these films can be analyzed. The results demonstrate that Ar annealing produces mainly the grain boundary defects which cause the enhancement of M-s. Ar/H-2-annealing creates not only grain boundary defects but also the grain defects, resulting in the stronger enhancement of M-s. Ferromagnetism for Co:ZnO films is influenced by both grain boundaries and grain defects. (c) 2007 American Institute of Physics.