Thin films of zirconia have been deposited using a reactive electron beam evaporation technique onto unheated alumina and fused silica substrates. The films were post annealed in the range 300–850 °C. The influence of post‐deposition conditions on the optical properties like refractive index and absorption and nonoptical properties like structure have been studied. The structural transitions were determined using infrared (IR) absorption and x‐ray diffraction. Preliminary results of studies on the correlation between x‐ray diffraction and IR absorption data for structural characterization are reported. It has been shown that the refractive index values change considerably with each structural transition, although the optical absorption does not seem to be very adversely affected by post‐deposition annealing. Post‐deposition annealing resulted in the formation of the cubic phase at 500 °C which transformed to the tetragonal phase at 700 °C and finally monoclinic phase at 800 °C. The above‐mentioned phases were only the major phases and post‐deposition annealing did not result in single‐phase material.