The Giant Magnetoresistive Effect (GMR) is a quantum mechanical effect observed in thin film structures composed of alternating ferromagnetic and nonmagnetic layers.

The effect manifests itself as a significant increase in resistance of the structure when two ferromagnetic layers contain electrons with opposite spin, compared to a lower level of resistance when the two layers contain electrons with parallel spin.

The effect was first discovered in pure crystal layers in 1988 by Peter Grünberg of the Jülich Research Centre and Albert Fert of the University of Paris-Sud, working independently. The possibilities of using the effect in a magnetic field sensor, and hence as a new type of reading head in a computer hard drive, were quickly recognised by an IBM research team led by Stuart Parkin, who replicated the effect in polycrystalline layers. IBM produced the first commercial device based on this effect in December 1997. Currently, research has focused on employing multilayered nanowires (which offer greater sensitivity than the thin films now used in hard drives), which also exhibit giant magnetoresistance.

It is more accurate to distinguish between two different cases, both normally attributed to be GMR:

(i) Two ferromagnetic layers are separated by a very thin (about 1 nm) non-ferromagnetic spacer (e.g. Fe/Cr/Fe). At certain thicknesses RKKY coupling between the two ferromagnets occurs and makes it energetically preferred to align either parallel or anti-parallel. The electrical resistance of the device is normally higher in the anti-parallel case and the difference can reach several 10% at room temperature.

(ii) Two ferromagnetic layers are separated by a thin (about 3 nm) non-ferromagnetic spacer, but without RKKY coupling. If the coercive fields of the two ferromagnetic electrodes are different it is possible to switch them independently. Therefore, parallel and anti-parallel alignment can be achieved, and normally the resistance is again higher in the anti-parallel case. This device is sometimes also called spin-valve.

Another application of the GMR effect is in non-volatile magnetic random access memory.