We fabricated In 0.52Al 0.48As:MnAs granular thin films by annealing [(In 0.52Al 0.48) 1− x Mn x ]As alloy thin films at 600 °C. The [(In 0.52Al 0.48) 1− x Mn x ]As thin films were grown on InP(0 0 1) substrates with Mn concentrations x of 0.09 and 0.12 by low-temperature molecular beam epitaxy. We investigated the structural and magneto-optical properties of the In 0.52Al 0.48As:MnAs granular thin films by X-ray diffraction and magnetic circular dichroism, and compared with those of the as-grown [(In 0.52Al 0.48) 1− x Mn x ]As thin films. The In 0.52Al 0.48As:MnAs granular thin films showed a large magneto-optical effect at room temperature. This large magneto-optical effect of the granular materials lattice-matched InP will be useful for InP-based magneto-optical devices operating at room temperature.