We have investigated the effects of sputtering Ar gas pressure as well as other deposition conditions on the magnetic and galvano-magnetic properties of NiFe thin films which were used in magnetoresistive hard disk reading head, and analyzed its effect through the microstructure of films. The films were prepared by dc magnetron sputtering from $Ni_{81}Fe_{19}$ wt% alloy target. The microstructure of films were investigated by TEM, the M-H hysteresis loops by VSM, and the composition by ICPS. The columnar structure with crack-like voids was observed in the films that were deposited in high(≥ 10 mTorr) Ar pressures. These crack-like voids were believed as a domain wall pinning site in magnetization process, and a scattering source in transport process. So the coercivity of films was increased with increasing Ar pressures, while the saturation magnetization was decreased due to decrease of density. It were grain boundary scattering and intergranular tunneling that made the resistivity of films high. Consequently, the magnetoresistance was reduced by these planar defects with increasing Ar pressure.