Zinc oxide (ZnO) has been deposited over a thermally grown SiO2 substrate. For applications in pyroelectric and piezoelectric devices, ZnO films need to exhibit low stress and a strong C-axis orientation. This study investigates the impact of annealing temperature on DC-sputtered ZnO thin films through X-ray diffraction (XRD) measurements conducted at various temperatures ranging from 300 to 600 °C. To determine the optimal annealing temperature for the thin film, many microstructural characteristics were analyzed including peak intensity, grain size, dislocation density, and stress. The XRD analysis shows that the annealing temperature affects the (002) peak's intensity. As temperature rises to 600 °C, grain size increases from 14.18 to 21.54 nm and dislocation density decreases from 4.97 × 10–3 to 2.15 × 10–3 nm−2. Additionally, the stress of ZnO thin film changes from compressive stress to tensile stress as temperature increases. The ideal annealing temperature for ZnO film has been discovered to be around 500 °C. At 500 °C, the ZnO thin film exhibits maximum (002) peak intensity, along with a reduced dislocation density, and minimal tensile stress.