The epitaxial growth process was optimized in order to obtain good surface morphology for epilayers grown on 4˚ off-axis substrates. The optimization was carried out from growth temperatures and gas chemistry including C/Si ratio. Step-bunching was significantly suppressed by the optimized process and a surface roughness Ra of 0.2 nm was achieved. Etch pit density evaluation by KOH etching indicated that the basal plane dislocations were reduced to less than 50 cm-2 by the use of 4˚ off-axis substrates. Photoluminescence evaluation showed that the epilayer grown by the optimized process had a better crystalline quality than that grown by a standard process. Schottky diodes fabricated on the epilayer by the optimized process represented the ideality factor n of 1.01 and the barrier height of 1.67eV. These results demonstrate that high quality epilayers with smooth surfaces comparable to those on 8˚off-axis substrates were obtained on 4˚off-axis substrates.