CdS thin films were deposited by the ion layer gas reaction (ILGAR) method. Structural, chemical, topographical development as well as optical and electrical properties of as-deposited and annealed thin films were investigated by XRD,SEM, XPS, AFM and UV-VIS. The results showed that the thin films are uniform, compact and good in adhesion to the substrates, and the growth of the films is 2.8 nm/cycle. The evolution of structure undergoes from the cubic structure to the hexagonal one with a preferred orientation along the (002) plane after annealing at 673 K. An amount of C, O and Cl impuriries can be reduced by increasing the drying temperature or by annealing in N2 atmosphere. It was found that the band gap of the CdS films shifts to higher wavelength after annealing or increasing film thickness. The electrical resistivity decreases with increasing annealing temperature and film thickness.