ZnO and Eu-doped ZnO thin films were deposited on quartz substrates by reactive radio-frequency magnetron sputtering from a ZnO and Eu-doped ZnO ceramic target respectively. The properties of thin films were characterized by atom force microscope (AFM), X-ray diffraction (XRD), and photoluminescence spectra (PL). XRD reveals that the prepared thin films possess a single crystalline hexagonal wurtzite crystal structure with preferential c-axis orientation. Under above-bandgap excitation at room temperature, PL shows that ZnO films exhibit strong UV near-band-edge excitonic emission and Eu-doped ZnO thin films present UV emission and red emission from Eu3+ ions, demonstrating efficient energy transfer from the host to Eu3+ ions. The influence of annealing on the structure and optical properties of ZnO and Eu-doped ZnO thin films is studied. The efficient energy transfer from the host to Eu3+ and high luminous efficiency indicates that the prepared Eu-doped ZnO thin films are very promising materials for lighting and flat panel display application.