Nickel doped indium oxide thin films (In 1-x Ni x ) 2 0O 3 at x = 0.00, 0.03, 0.05 and 0.07 were deposited onto glass substrates by electron beam evaporation technique. The deposited thin films were subjected to annealing in air at 250 °C, 350 °C and 450 °C for 2 h using high temperature furnace. A set of films were vacuum annealed at 450 °C to study the role of oxygen on magnetic properties of the (In 1-x Ni x ) 2 O 3 thin films. The thin films were subjected to different characterization techniques to study their structural, chemical, surface, optical and magnetic properties. All the synthesized air annealed and vacuum annealed films exhibit body centered cubic structure without any secondary phases. No significant change in the diffraction peak position, either to lower or higher diffraction angles has been observed. The band gap of the films decreased from 3.73 eV to 3.63 eV with increase of annealing temperature from 250 °C to 450 °C, in the presence of air. From a slight decrease in strength of magnetization to a complete disappearance of hysteresis loop has been observed in pure In 2 O 3 thin films with increasing the annealing temperature from 250 °C to 450 °C, in the presence of air. The (In 1-x Ni x ) 2 O 3 thin films annealed under vacuum follow a trend of enhancement in the strength of magnetization to increase in temperature from 250 °C to 450 °C. The hysteresis loop does not disappear at 450 °C in (In 1-x Ni x ) 2 O 3 thin films, as observed in the case of pure In 2 O 3 thin films. © 2017 IACS.