Cd0.96Zn0.04Te thin films are deposited onto well cleaned glass substrates (Corning 7059) kept at room temperature by vacuum evaporation and the films are annealed at 423 K. Rutherford Backscattering Spectrometry and X‐ray diffraction techniques are used to determine the thickness, composition and crystalline structure and grain size of the films respectively. The films exhibited zinc blende structure with predominant (111) orientation. The surface morphology of the films is studied by Atomic Force Microscopy. The rms roughness of the as‐deposited films is 3.7 nm and on annealing the films at 423K, the rms roughness value decreases to 3.4 nm. The Raman spectra of the Cd0.96Zn0.04Te films are recorded at room temperature to study lattice vibrations and their interactions with other excitations. The intensity of the peak increases and the FWHM decreases on annealing the films. The pseudodielectric‐function spectra, ε(E) = ε1(E) + i ε2(E), of polycrystalline Cd0.96Zn0.04Te thin films in the 1.3 ‐ 5.5eV photon energy range at room temperature are measured by spectroscopic ellipsometry. The measured dielectric function spectra reveal distinct structures at energies of the E1, E1+Δ1 and E2 critical points are due to interband transitions.