The stress relaxation and its effect on the bandgap of Y-doped ZnO (YZO) thin films were investigated by thermal annealing. YZO thin films were prepared on quartz glass by spin coating and subsequent annealed in vacuum. All the annealed YZO films showed a preferred (002) orientation. Photoluminescence (PL) provides the direct evidence of shifting the bandgap owing to stress release phenomena. The shifting in bandgap by increasing the annealing temperature can be attributed to the stress relaxation of YZO thin films. The bandgap of annealed films was initially decreased due to increase in magnitude of compressive stress and then increased as the tensile stress induced in the films. Therefore, these results may suggest the way to tune the band gap of YZO thin films by varying the residual stress through annealing. (C) 2015 Elsevier B.V. All rights reserved.