In this approach, Ag thin films have been prepared using electron beam evaporation technique onto a thin film of tin-doped indium oxide coated ordinary glass substrate. The fabricated thin films were annealed in various temperatures: 100, 200, 300 and 400 degrees C and the effect of annealing on their wetting, structural and morphological properties has been investigated. Scanning electron microscopy (SEM), UV-Visible spectroscopy (UV-Vis), diffuse reflectance spectroscopy (DRS), X-ray diffraction (XRD) and contact angle measurement have been applied for the characterization and study of thin film surfaces. The results of SEM exhibit the aggregation and formation of Ag nanoparticles on the surface of substrate changed through increasing of annealing temperature. The presence of mixed In2O3-Ag phases in the as-prepared and annealed samples was confirmed by XRD pattern. Optical behavior of thin films was followed by using diffuse reflectance spectroscopy. Wettability studies showed that the contact angle of prepared thin films was influenced by various parameters such as annealing temperature, surface morphology and composition of thin films.