Cadmium telluride films have been grown by a modified close‐spaced vapor transport technique under different argon pressures (Pg) to get variable grain size and crystalline film properties. These films have been studied in terms of the variations of their structural and optical properties. Using SEM and microanalysis measurements it has been found that films grown at low pressures (∼1.5 mTorr) have a constant grain size; whereas, for films grown at highPg’s (∼50 Torr), inhomogeneities in grain size and a large density of defects are observed. Photoluminescence spectra taken at different regions in the different films are in good agreement with the presence of Cd vacancies and defects due to the growth process. The presence of an intense exciton‐related luminescence peak indicates good crystalline quality grains.