Abstract Amorphous Se85−xTe15Hgx (x = 0, 2, 10, 15) thin films have been prepared onto glass substrate by using thermal evaporation technique. Optical absorption coefficient (α), extinction coefficient (K), optical band gap (Eg), Urbach energy (Ee) for as deposited thin films have been calculated from the transmittance measurements in the range 190–1100 nm. Effect of thermal annealing on optical parameters has been investigated in the temperature range 303–373 K. Analysis of optical absorption indicates that optical band gap of these films obeys Tauc’s relation for allowed indirect transition. Optical band gap (Eg) decreases and Urbach energy (Ee) increases with increase in Hg concentration. It may be due to increase in density of states or defect states. Optical band gap (Eg) first increases with increase in annealing temperature then decreases. At first due to thermal annealing, unsaturated defects are annealed out producing large number of saturated bonds. Further annealing at high temperature, amorphous solids crystallize under heat treatment and in crystallization process, dangling bonds are produced around the surface of crystallites.