We investigate the effect of yttrium-doping on the microstructures and semiconductor-metal phase transition characteristics of polycrystalline VO2 thin films prepared by reactively co-sputtering process. XPS analyses indicate the existence of Y3+ in the Y-doped VO2 films, but Y-doping hardly influences the chemical states of V and O elements. X-ray diffraction patterns and Raman spectra reveal that both undoped and Y-doped VO2 thin films have a polycrystalline structure of monoclinic VO2. The introduction of Y greatly reduces the grain size of VO2 thin films as evidenced by scanning electron microscopy analyses. The relationship between the hysteresis width and doping level is not monotonic although the grain size is monotonically reduced with increasing the doping level. Y-doped VO2 films with optimal doping level (1.82at%) have a notably narrower hysteresis width (4.6°C) than undoped VO2 films (10.7°C). This is ascribed to increased heterogeneous nucleation centers due to Y in the VO2 lattice. With the further increase of doping level, the size effect gradually plays a prominent role in SMPT, and the hysteresis width of Y-doped VO2 films increases instead. The SMPT temperature of Y-doped VO2 films obviously decreases compared with undoped VO2 films due to reduced grain size and deformation of local structure around Y atom.