Incorporation of Ag nanocrystal into indium tin oxide films (Ag-ITO) could enhance the conductivity of transparent oxide thus attracts more and more interest. Ag-ITO films were prepared by a modified sol-gel method. The surface structure was investigated by X-ray diffraction, X-ray diffuse scattering, and X-ray photoelectron spectroscope techniques. The results showed that stannous chloride worked well as the reduction agent of silver and ion donor source, resulting in high quality nanocomposite thin films. The embedment of silver nanoparticles decreased the crystallization temperature and inhibited the growth of indium oxide. Ag-ITO films have a hierarchical structure. Furthermore, the nanocomposite films were densified and homogenized through prolonging the thermal duration time. XPS results confirmed that a small amount of silver oxide appeared. (c) 2009 Elsevier B.V. All rights reserved.