In the present study, we investigated the effect of Mg doping level (0, 1, 3, 5, 7, 10, 20 and 30% Mg) and annealing temperature (TA: 773, 823, 873 and 973 K) on the structural optical and electric properties of highly c-axis oriented Mg-doped ZnO (ZMO) thin films deposited on p-Si by sol-gel spin-coating process. The ZMO thin films were analyzed by x-ray diffraction, field emission scanning electron microscopy (FESEM), x-ray photoelectron spectroscopy (XPS), Fourier-transform infrared, ultraviolet/visible (UV/VIS) spectrophotometer. The highly c-axis oriented ZnO hexagonal structure was observed in all thin films. Crystallite size increased at higher annealing temperature (TA), whereas decreased with increasing certain Mg doping ratios except for the 5 and 7%. The FESEM analyses showed that more homogeneous distribution of nanospherical particles, increased in size at higher TA treatments, whereas their size decreased with increasing Mg doping concentrations except for the 5 and 7%. Energy dispersive spectra and XPS analyses confirmed the insertion of Mg2+ within ZnO lattice. Optical band gap value was increased by Mg doping ratio, whereas decreased at higher TA. The ZMO thin films showed a relatively high transmittance, Extinction coefficient decreased with increasing Mg doping ratio, however, increased at higher TA treatments. Refractive index was also decreased at higher Mg doping levels except for the 20% doping level. Depending on the applied voltage and Mg doping level the rectifying behaviour with high rectification ratio was observed from current-voltage (I-V) characteristics of ZMO/p-Si heterojunction diodes. Overall, our study clearly showed that the 20% Mg-doped ZnO thin films had the optimum optical and I-V characterizations.