Long-term operation of TeO2 acousto-optical device is limited by the formation of surface damage caused by the He Cd laser irradiation. Similar surface damage occurs during the heat treatment of the TeO2 crystal at 350 degrees C. In this study, TeO2 specimens after various surface treatments have been observed by electron microscopy and X-ray photoelectron spectroscopy. The variation of the transmittance for mechanically polished specimens has been measured in situ during heat treatments. It was found that the thermal surface damage at 350 degrees C was formed in the surface layer damaged by mechanical polishing. The mechanically damaged layer was amorphous and deficient in oxygen in the as-polished state. The electron microscopic observation revealed that the surface damage layer induced by heat treatments or by the ultraviolet light irradiation contained tellurium particles (20-40 nm) in diameter dispersed in the TeO2 matrix. On annealing the TeO2 specimen at 500 degrees C in air, however, the particles disappeared because of the melting, evaporation and oxidation of tellurium which restores the transmittance of the crystal. Based on the results, combined with the observation of surface damage induced by the visible light irradiation, a possible mechanism of the surface damage formation has been briefly discussed.