We have investigated the effect of the barrier strain in + 1.65%-strained In0.77Ga0.23As/InGaAs multiple quantum wells (MQWs) on the structural and optical properties by means of double-crystal X-ray diffraction, transmission electron microscopy (TEM), and room-temperature photoluminescence (PL). The optimum condition of the barrier layer deduced from the X-ray and the PL measurements was nearly lattice-matching, i.e., strain from - 0.40 to + 0.20% is required for the sharp X-ray diffraction satellite peaks and from - 0.17 to + 0.14% for large PL intensity. Under compressive strain in the barrier layer, misfit dislocations are introduced into the MQW structures. In the case of tensile strain, however, threading dislocations originating from the thickness undulations in the wells and the barriers are observed. The TEM studies reveal that the thickness undulations are induced by the compositional modulation. The undulation and modulation are enhanced by increasing the tensile strain in the barrier layers. These results indicate that the strain-compensation does not work well on the MQW containing such highly strained InGaAs wells.