Gadolinium oxide thin films have been prepared by electron beam evaporation with different reactive oxygen pressures at low ambient substrate temperature. These thin films have been analyzed with phase-modulated spectroscopic ellipsometry and multi-mode atomic force microscopy (AFM). The distinct influences of oxygen pressure on surface topographies, microstructures and refractive indices of the thin films have been observed from the results of these advanced measurements. Both these techniques have displayed very strong co-relationships in the characterisation results acquired through respective modes of measurements and data analysis. Unequivocally, these two techniques indicated an optimum value of the oxygen pressure leading to best optical and structural properties of such a novel optical coating material. (C) 2002 Elsevier Science B.V. All rights reserved.