Thin films of aluminum zinc oxide are prepared using DC magnetron sputtering. It was found that changing the thickness of the film as well as the pressure of argon affect the transmittance, optical gap, width of the band tails of the localized state, refractive index, real and imaginary parts of the dielectric function. The real and imaginary parts of optical conductivity as well as volume and surface energy loss functions are investigated in the light of changing the thickness of the films and argon pressure.