Abstract <p>Aluminum-doped zinc oxide (AZO) thin films were fabricated at room temperature on glass substrates using confocal RF magnetron sputtering, with a deposition time of 60 min. To assess the effects of thermal treatment, the films were subsequently annealed in a vacuum for 60 min at temperatures of 250 and 450°C. An investigation was carried out to study the films’ physical structure, surface morphology, and optoelectrical characteristics using advanced characterization techniques. The annealing process significantly enhanced the crystalline quality by improving <i>c</i>-axis orientation, increasing crystallite size, and reducing compressive stress. The surface morphology and roughness examined using atomic force microscopy (AFM) and Field emission scanning electron microscopy (FESEM), exhibited noticeable changes with varying annealing temperatures, highlighting a clear dependence on the thermal treatment. Optical properties, measured via UV–Visible spectroscopy, showed that the as-deposited films had an average transmittance of 68.7% in the visible spectrum. After annealing, both optical transmittance and band gap values increased substantially, with higher annealing temperatures further improving the films’ transparency and optical performance. Hall-effect measurements indicated that the electrical properties of the films improved with increasing annealing temperature. Notably, the AZO thin film annealed at 450°C exhibited a lower resistivity of 4.3&#xa0;× 10^–4 Ω cm and an average optical transmission of 87.5%, along with a high figure of merit (φ_<i>TC</i>) value of 1.1 × 10^–3 Ω^–1. These results highlight the vital role of vacuum annealing in optimizing AZO thin films for optoelectronic applications.</p>