Evolution of surface morphology and optical characteristics of 1.3-\mum In0.5Ga0.5As/GaAs quantum dots (QDs) grown by molecular beam epitaxy (MBE) are investigated by atomic force microscopy (AFM) and photoluminescence (PL). After deposition of 16 monolayers (ML) of In0.5Ga0.5As, QDs are formed and elongated along the [110] direction when using sub-ML depositions, while large size InGaAs QDs with better uniformity are formed when using ML or super-ML depositions. It is also found that the larger size QDs show enhanced PL efficiency without optical nonlinearity, which is in contrast to the elongated QDs.