In situ electrical conductance is used to monitor the growth and natural oxidation of aluminum on top of a CoFe electrode. Light oxidation is found to enhance the electron specular scattering of the CoFe/vacuum interface. Aluminum deposited onto CoFe intermixes to a depth of a few atomic layers, however, subsequent natural oxidation tends to reverse this interdiffusion through oxygen-driven A1 segregation. At the right A1 thickness, natural oxidation creates a clean and specular CoFe∕AlOx interface very similar to the best achievable CoFe/vacuum interface. For thicker A1, natural oxidation leaves behind underoxidized AlOx and most importantly an interdiffused CoFe∕Al interface. Using 2Torr×150-s natural oxidation, we have fabricated magnetic tunnel junctions (MTJs) with a peak tunnel magnetoresistance (TMR) of 18% for a resistance area product of 7Ωμm2, at the A1 metal thickness of 6 Å. With the same oxidation process TMR drops to only 8% when A1 is increased to 9 Å. Contrary to the accepted view, we do not attribute this TMR drop to A1 underoxidation, but primarily to the interdiffusion at the CoFe∕Al interface. This assertion is strongly supported by a second set of MTJs differing only by the insertion of a nano-oxide layer (NOL) on top of CoFe. In this case when Al is increased from 6 to 9 Å, the TMR does not drop but increases from 16% to 27%. This is significant because NOL is found to effectively prevent Al diffusion into CoFe. NOL is also found to act as a reservoir of oxygen, which is subsequently consumed by Al.