The present work reports the formation of Ni nanoparticles inside the SiO₂ matrix and deals with the influence of Ni concentration on structural and magnetic properties of Ni–SiO₂ nanocomposite thin films. The films with varying Ni concentration (20–55 at% measured by Rutherford back scattering spectroscopy) were deposited using DC/RF magnetron co-sputtering. TEM and XRD analysis reveal the formation of FCC Ni nanoparticles in all the samples. The particle size varies from 3 to 10 nm as a function of Ni concentration. The surface roughness of the films is also found to increase with increase in nickel concentration. Magnetic measurements show that the Ni nanoparticles behave as superparamagnets when their size is ≤6 nm, in spite of their large volume fractions. The results show that the magnetic properties of the nanoparticles can be controlled by their size and Ni concentration in the samples.