Reactive ion‐beam deposition of zirconia films is carried out to demonstrate the characteristic difference between the sputtered species from a metallic zirconium target and a compound zirconia target, and their effects on the structural properties of deposited films. Films deposited from the compound target have compositions much closer to the ideal stoichiometry of zirconia, and have higher stresses and are mechanically harder, due to the ionic nature of the sputtered species and their inherently low mobility on the substrate surface. In contrast, adatoms sputtered from the metal target are chemically less active but have a higher mobility which facilitates the relief of film stress by low‐energy Ar+bombardment during deposition. This stress modification process requires a much greater dosage of Ar+flux when a compound target is used. X‐ray diffraction analysis indicates that all of the zirconia films deposited from the metal target are amorphous, whereas the monoclinic phase is observed in the films from the compound target at sputtering energies of 500 and 1000 eV. However, the monoclinic crystallites diminish as additional energy is imparted to the growing film from either a higher sputtering energy or a greater flux of Ar+bombardment. The polymorphic transformation of zirconia films is examined by isochronal annealing of the films in a temperature range from 150 to 600 °C. The phase transformation of the zirconia films shows that the monoclinic zirconia persists after annealing while the amorphous matrix transforms into a cubic structure in the temperature regime from 300 to 450 °C.