Radio frequency magnetron sputtered Al-doped zinc oxide (AZO) thin films were formed on n-type gallium nitride (GaN). X-ray diffraction reflections and Raman modes confirmed the formation of the AZO films. The optical band gap of the deposited AZO film was found to be 3.31 eV and exhibited a fairly smooth surface and continuous growth across the surface with a grainy structure. The Au/AZO/n-GaN heterojunction Schottky diode was fabricated and investigated the influence of the presence of AZO layer in Au/n-GaN Schottky diode, characterizing its electrical and breakdown voltage properties. The AZO layer led to an excellent improvement in the rectifying behavior with an increase in barrier height of the Au/n-GaN Schottky diode from 0.69 to 0.90 eV. Reverse breakdown voltage of the Au/n-GaN Schottky diode and Au/AZO/n-GaN heterojunction diode were obtained to be 86 and 232 V, respectively, without any edge termination methods. The AZO layer effectively reduced the interface states in the Au/n-GaN Schottky diodes. Schottky and Poole-Frenkel emission mechanisms dominated the reverse current in Au/n-GaN Schottky diode and Au/AZO/n-GaN heterojunciton diode, respectively. The results signify the importance of the metal-insulator-semiconductor structure and in particular the AZO layer in reducing the leakage current and improving the device performance. A further improvement in breakdown voltage can be achieved by employing field plate and guard-ring structures for edge termination.