Nanocomposite thin films of Au–alumina with varying Au contents were synthesized by atom beam co-sputtering. The Au content and the thickness of nanocomposite films were determined by Rutherford backscattering spectrometry. Transmission electron microscopy studies reveal the presence of Au nanoparticles with bimodal size distribution in nanocomposites for lower Au content. Overlapping Au nanoparticles were observed for higher Au content. The increase in size of Au nanocrystals is observed with increase in Au concentration as also evident by glancing angle X-ray diffraction studies. Ultraviolet (UV)-visible absorption studies revealed surface plasmon resonance (SPR) peak which showed a red shift from 519 to 602 nm with increasing Au content of the nanocomposites. Preliminary study exploring the interaction between Au nanoparticles in the nanocomposites and bovine serum albumin (BSA) showed the Au nanoparticles to be BSA sensitive, indicating their possible applications in biosensors.