In this work, aluminum-doped zinc oxide (AZO) films were annealed under argon flux at different temperatures and cooled down slowly to room temperature. Afterward, optical properties of samples were studied and their optical band gap were estimated by different methods such as dR/dλ (3.33–3.83 eV), dT/dλ (3.8–4.1 eV), optical conductivity (3.7–4.53 eV), dielectric relaxation time (3.65–3.87 eV), d(αhν)/dhν (3.44–3.95 eV), Tauc power law (3.4–4 eV), and the single oscillator model (2.67–3.37 eV). Increasing annealing temperature caused a redshift in the maximum of the dielectric relaxation time (τ) peaks. The dispersion parameters were studied through single oscillator model. The oscillator strength (f ) and the dispersion energy (Ed ) of films were decreased by increasing annealing temperature so that the films annealed at 600 ◦C had minimum Urbach’ s energy (Eu) of 0.05 eV with minimum disordered. Due to high Al content, asdeposited films had maximum dielectric constant at higher wavelength (ε∞)