In this article, we first emphasize several interesting aspects of granular materials. After overviewing electrical conductivity, such as electrical resistivity and magnetoresistance (MR), in ferromagnetic metals and alloys, we review MR, magnetic properties and structure of granular Fe/Cu films produced by the ion-cluster-beam method. These films reveal giant MR (GMR) at low temperature without post-annealing. The non-saturation behavior of GMR and the saturation behavior of magnetization against applied fields demonstrate that conduction electron scattering by magnetic moments at the cluster-matrix interface plays an important role of GMR. The nanometric scale compositional and structural imhomogeneity, and atomic scale structure of these films are discussed using the results of small angle X-ray scattering and extended X-ray absorption fine structure spectra.