We study by X-ray absorption spectroscopy the local structure around Zn and Ga in solution-processed In-Ga-Zn-O thin films as a function of thermal annealing. Zn and Ga environments are amorphous up to 450 degrees C. At 200 degrees C and 450 degrees C, the Ga atoms are in a beta-Ga2O3 like structure, mostly tetrahedral gallium oxide phase. Above 300 degrees C, the Zn atoms are in a tetrahedral ZnO phase for atoms inside the nanoclusters. The observed formation of the inorganic structure above 300 degrees C may be correlated to the rise of the mobility for IGZO TFTs. The Zn atoms localized at the nanocluster boundary are undercoordinated with O. Such ZnO cluster boundary could be responsible for electronic defect levels. Such defect levels were put in evidence in the upper half of the band gap. (C) 2015 WILEY-VCH Verlag GmbH & Co. KGaA, Weinheim