TiN-capped epitaxial bce Fe films exhibit strong changes in the out-of-plan
e interplanar distance depending on the growth conditions. At room temperat
ure, the increase of the volume per Fe atom appears to be as large as 5%. T
he observed distortions deviate substantially from elastic behavior. We exp
lain this effect as due to the presence of nitrogen incorporated into the F
e film during the capping layer deposition. In order to elucidate the effec
t that these distortions might have on the optical and magneto-optical prop
erties, we study the diagonal and off-diagonal elements of the conductivity
tensor for both distorted and undistorted structures. This is done by mean
s of spectral ellipsometry and the Kerr effect in polar and transverse conf
igurations in the energy range from 1.5 to 4.5 eV. Theoretical calculations
using ab initio techniques for the observed structures are per formed and
compared with experimental data. Different possible mechanisms for the expe
rimentally observed effects such as distortion, grain size, and orbital hyb
ridization are studied and discussed.