Two different post deposition annealing atmospheres of oxygen and forming gas have been investigated for the improvement of rf sputtered zinc oxide thin films. The results show that type of atmosphere (oxidant o reduction) plays an important role in the changes observed in structural, electrical and optical properties. It has been found that the structural properties of rf sputtered zinc oxide films improve in all the annealing environments. The intensity and grain size increases as the annealing temperature increases. It has been found that films become stress free at lowest temperature in oxygen as compare to forming gas annealing. The zinc oxide films annealed in oxygen shows sufficient resistivity associated to high transmittance (83 %) characteristics required for MEMS based acoustic devices.