Using cross-sectional transmission electron microscopy (TEM), microstructural changes in Ni contacts on n-type 4H-SiC as a function of annealing temperature were investigated. From these results, the correlation between the microstructural change and electrical properties was interpreted. After annealing at 800 degreesC, which yielded rectifying behavior, the silicide phases were formed, composed of Ni2Si and Ni31Si12. From the results shown in microbeam diffraction patterns, Ni31Si12 remains at the surface and Ni2Si is dominant in the contact, indicating that Ni2Si started to grow at the interface through the outdiffusion of Si atoms. When the sample was annealed at 950degreesC, ohmic behavior was shown, and the layer structure was changed to a C-rich layer/Ni2Si/NiSi/n-type SiC. The NiSi phase was observed. These results imply that the composition of Si in nickel silicide at the interface with SiC increased with the increase of annealing temperature. The observation of the graphite phase at the surface indicates that the C atoms diffused out to the surface at 950 degreesC. This leads to the formation of carbon vacancies, acting as donors for electrons. These suggest that the production of carbon vacancies plays a major role in the formation of ohmic contact through the reduction of the effective Schottky barrier height for the transport of electrons.