Indium tin oxide (ITO) films of different compositions using respective alloys were prepared at relatively low substrate temperatures (130 degrees C) in an oxygen atmosphere of 10(-4) Torr by reactive evaporation. The films were post annealed isochronally as well as isothermally and characterized by X-ray diffraction and scanning Auger microscopy. Electrical and optical properties were measured to optimize the preparation and annealing conditions. The properties of ITO films showed a strong dependence on annealing temperature and on the proportion of In and Sn. Maximum transmission was obtained for films wth 50 wt.% In and 50 wt.% Sn. The electrical resistivity rho, carrier concentration n(e) and mobility mu(H) were explained on the basis of oxygen vacancies and oxidation processes. Band gap widening with an increase in carrier density was observed and is explained on the basis of Burstein-Moss shift. Annealing just for 5 min at 500 degrees C was found to be enough to complete the oxidation process. The figure of merit was calculated and found to be satisfactory. From these studies it is concluded that these films can be used as transparent conductors.