Hydrogenation effects in excimer laser annealed polysilicon thin-film transistors (TFTs) were studied. Hydrogen plasma formed from hydrogen diluted with Ar or He was used in order to passivate defects at the polysilicon/silicon oxide interface, as well as in the polysilicon material. It was found that, after hydrogenation, no more than a 10% increase in the carrier mobility is attained, accompanied by a threshold-voltage decrease, due to passivation of deep states at the polysilicon/silicon oxide interface and at the grain boundaries. However, the most important feature of hydrogenated devices is the improvement in the dispersion of their transfer characteristics. In addition, hot-carrier stress experiments showed that optimization of the type of dilution gas (Ar or He) and the relative concentration of hydrogen can be carried out in order to improve the device reliability.