p-type nitrogen doped Zn1−xMgxO (x = 0.15) thin films were prepared on n-type silicon substrates by RF sputtering. Plasma-immersion-ion technique and rapid-thermal process were used to implant nitrogen and annealing (700–1000 °C) of these films respectively. Annealed samples at 700, 800, 900 and 1000 °C showed effective improvement of the structural and optical properties. X-ray diffraction spectra showed improvement in <002> orientation of films with increase in annealing temperatures. In Raman spectra, the peak at 436 cm−1 corresponds to E2 high phonons mode of ZnMgO wurtzite structure and FWHM of this peak decreases with increase in annealing temperature, indicating improvement in crystalline quality. The scanning electron microscopy results demonstrate that nitrogen-implanted ZnMgO film annealed at 1000 °C has better morphology in comparison to other films. Low-temperature (15 K) photoluminescence measurements revealed acceptor-bound exciton peak at 3.45 eV and donor-bound exciton peak around 3.52 eV. Increased intensity of acceptor-bound exciton peak with increasing annealing temperature proves that nitrogen implantation and subsequent annealing increase the acceptor concentration in the film, indicating tendency for p-type conduction at higher annealing temperature. The film annealed at 1000 °C was observed to produce only acceptor-bound exciton emission and no donor-bound exciton emission was occurred. Hall-effect measurements showed p-type conductivity for annealed films in temperature range at 800–1000 °C. The acceptor level at 3.45 eV in PL spectra is responsible for this p-type conduction in these films. The highest hole concentration of 1.91 × 1015 cm−3 has been achieved for film annealed at 1000 °C. © 2015, Springer Science+Business Media New York.