This book gives an overview of the nanostructure and the resulting electronic and optical properties of metal nanoparticles embedded in insulating polymer matrices. The preparation of such materials is reviewed with special attention to various thin film deposition techniques. Deposition parameters, chemical and physical properties of the matrix material as well as the application potential of such films are described. Extensive investigations of the nanostructure are presented and detailed descriptions of the particle geometry are given. As a result of various diffusion processes during thermal annealing or electron- and laser-beam irradiation, substantial changes of the metal particle size and shape distribution are observed. Extensive measurements of the electronic and optical properties are presented to demonstrate detailed relationships between the nanostructure and the electronic and optical properties. Modelling of the optical properties with various theories is explained in detail and can be transferred straightforwardly to a large number of other materials.