An epitaxial cobalt silicide film is formed using a thin metal underlayer, which is placed underneath a cobalt layer prior to a heating step which forms the silicide film. More specifically, a refractory metal layer comprising tungsten, chromium, molybdenum, or a silicide thereof, is formed overlying a silicon substrate on a semiconductor wafer. A cobalt layer is formed overlying the refractory metal layer. Next, the wafer is annealed at a temperature sufficiently high to form an epitaxial cobalt silicide film overlying the silicon substrate. Following this annealing step, a cobalt-silicon-refractory metal alloy remains overlying the epitaxial cobalt silicide film. This silicide is then used to form a shallow P-N junction by dopant out-diffusion. First, either a P or N-type dopant is implanted into the silicide film so that substantially none of the dopant is implanted into the underlying silicon substrate. After implanting, the dopant is out-diffused from the silicide film into the underlying silicon substrate at a drive temperature sufficiently high to form the desired P-N junction.