Silicon oxynitride (SiON) films were deposited on p-type (100) silicon substrates by plasma enhanced chemical vapor deposition (PECVD), at the temperature of 300 degrees C, using silane (SiH(4)), nitrogen (N(2)) ammonia (NH(3)) and laughing gas (N(2)O) as gas precursors. The effects of the processing gas ratio of N(2)O/(N(2)+NH(3)) on the optical properties, microstructure and chemical bonding evolutions of SiON material, and the influences of silicon nano-crystallized structures on the optical performance of SiON-based rib-type optical waveguides were studied. Microstructure evolutions analysis and optical measurements indicated that the refractive index and the extinction coefficient could be precisely determined by controlling the N(2)O/(N(2)+NH(3)) ratio and the thermal annealing process. A greater density and dimension of silicon nanocrystallized structures resulted in more optical scattering effect phenomena occurring between the interface of silicon nano-crystallized structure and SiON matrix and more optical propagation loss. (C) 2008 Elsevier B.V. All rights reserved.