Highly-transparent V-doped TiO2 thin films were prepared by sol-gel processing, spin coated on fused silica glass substrates, and annealed in air at 450 °C for 2 h. All of the films were comprised of anatase as the sole crystalline phase. The XPS data suggested that V formed an interstitial solid solution with anatase. The formation of an unsaturated solid solution at the lowest doping level of 0.05 mol% resulted in the formation of lattice defect sites, which enhanced anatase recrystallisation, grain growth, and crystallinity. In contrast, the formation of supersaturated/oversaturated solid solutions at the higher doping levels of 0.10–1.00 mol% resulted in lattice deformation, partial amorphisation, precipitation, and liquid formation. The coexistence of multiple valence states, viz., Ti4+/3+, V4+/3+, and possibly V5+ in the doped TiO2 films was attributed to intervalence charge transfer. Dye degradation tests revealed that the 0.05 mol% V-doped films showed the best photocatalyic performance and this was attributed to the combined effects of greater anatase crystallinity and reduced band gap. In contrast, increasing V-doping levels resulted in gradual decreases in the photocatalytic performance, which are attributed principally to the decrease in areal density of the surface-active sites owing to liquid-phase densification. The greater degradation of MB solution relative to that of RhB solution is attributed principally to the cationic nature of MB, which allows greater adsorption on the photocatalyst surface in comparison to the anionic RhB.