The x-ray absorption fine structure (XAFS) technique has been employed to investigate the local structure and valency about Mn and Fe ions in the III-V diluted magnetic semiconductors In(1-x)Mn(x)As and Ga(1-x)Fe(x)As, prepared by molecular-beam-epitaxy under various growth conditions. These new systems are promising magnetic materials of considerable current interest and with important technical applications including photo-carrier induced magnetism and spin-polarized current devices. The local structure around the magnetic ions can play a pivotal role in affecting the magnetic properties of these semiconductors. Local structure information obtained from XAFS has provided the first direct evidence that the magnetic impurities can indeed substitute for the cation host atoms in samples prepared under appropriate conditions.