Titanium dioxide is extensively used as the high index film material in multilayer optical thin film devices. Optical absorption in the films depends upon deposition parameters, important among them being substrate temperature and starting material. In this investigation, single layer titanium dioxide films have been prepared by reactive electron beam evaporation of TiO in neutral and ionized oxygen medium. The substrate temperature is maintained in the range 25°C to 250°C and its influence on the optical absorption of the films is studied. The influence of film thickness on optical. absorption is also investigated. Films of thicknesses 1400 Å and 2800 Å have been deposited. With increasing substrate temperature, the absorption in TiO2 films deposited in neutral oxygen atmosphere increased and showed a maximum at 175°C for thinner films (1400Å) and 150°C for thicker films (2800Å). Though similar behaviour was observed in films deposited using ionized oxygen, the substrate temperature has been found to have only a marginal effect on optical absorption of these films. The variation in optical absorption in TiO2, films has been explained on the basis of variation in condensation of oxygen as well as the evaporant due to substrate heating.