In recent years, studies have focused on discovering promising new high- k dielectric materials for a variety of optoelectronic and microelectronic device applications. Lutetium oxide (Lu2O3) is one of the reported promising dielectric materials for IC applications due to its thermodynamic stability with Si, high dielectric constant and low leakage characteristics. It is known that the device characteristics are significantly affected by structural quality of dielectric layer and its interface between semiconductors. Therefore, in this work the effects of deposition parameters on structural, optical and electrical properties of Lu2O3 thin films were discussed in detail. The Lu2O3 thin films deposited on Si wafers at 230 W, 270 W and 300 W sputtering powers by reactive RF sputtering and deposited films were annealed from 500 0C, 750 0C and 900 0C in Nitrogen environment for 1 hour. The structural characterizations were performed by using X-ray diffraction (XRD) and Atomic Force Microscopy Measurements (AFM), while optical characteristics were investigated by Uv- Vis spectroscopy. The capacitance- voltage characteristics were also measured to study electrical properties of the fabricated films. The results demonstrate that both sputtering and annealing temperature crucially effects the device characteristics and strong relation between structural, optical and electrical characteristics have been observed. Among the all fabricated devices, with low interface state density and low surface roughness, Lu2O3 MOS capacitors sputtered at 300 W and annealed at 750 0C exhibits demanding performance future microelectronic applications.