System integration and miniaturization with higher performance is driving thin-film capacitor technologies toward higher capacitance densities with CMOS or organic package-compatible processes for noise-free power supply, power conversion, and efficient power management. The hydrothermal route can deposit crystalline ferroelectric films at low temperatures of < 150 degrees C. It is hence an attractive route for integrating high-permittivity (K) thin-film capacitors on both organic and silicon substrates. However, hydrothermal films are not commercialized so far because of their inferior insulation characteristics. Hydroxyl groups are attributed to high leakage currents, temperature-dependent properties, and lower breakdown voltages. This paper discusses the dielectric characteristics such as capacitance density, leakage current, and temperature coefficient of capacitance of hydrothermal barium titanate films and correlates them with the water and OH groups in the film, morphology, stoichiometry, and crystallinity. With thermal treatment, majority of the OH groups can be removed leading to improved insulation characteristics. The room temperature I-V characteristics agreed with ionic conduction models for films baked at 160 degrees C. A brief perspective is provided on the suitability of hydrothermal thin-film capacitors for decoupling applications.