ZnMgO thin films deposited on 〈100〉 Si substrates by RF sputtering were annealed at 800, 900, and 1000°C after phosphorus plasma immersion ion implantation. X-ray diffraction spectra confirmed the presence of 〈10 1̄0〉 and 〈10 1̄3〉 peaks for all the samples. However, in case of the annealed samples, the 〈0002〉 peak was also observed. Scanning electron microscopy images revealed the variation in surface morphology caused by phosphorus implantation. Implanted and non-implanted samples were compared to examine the effects of phosphorus implantation on the optical properties of ZnMgO. Optical characteristics were investigated by low-temperature (15K) photoluminescence experiments. Inelastic exciton-exciton scattering and localized, and delocalized excitonic peaks appeared at 3.377, 3.42, and 3.45eV, respectively, revealing the excitonic effect resulting from phosphorus implantation. This result is important because inelastic exciton-exciton scattering leads to nonlinear emission, which can improve the performance of many optoelectronic devices. © 2014 AIP Publishing LLC.