In this work, In2O3 nanoparticles were prepared by sol-gel method and deposited on quartz substrate by dip coating technique and annealed in air at different temperatures of (450, ,550 and 650) ̊ C at constant time (60 min). X-ray analysis has confirmed the formation of polycrystalline cubic phase that increases in crystaline size with increasing annealing temperature. The optical properties of In2O3 nanostructure thin film were studied. The transmittance was measured in the wavelength range from(300nm to 1100 nm) for all the films.The sensitivity toward NO2 gas has been measured,where In2O3 annealed at different temperatures.