Nanostructured Al-doped ZnO (AZO) films are deposited on glass substrates by electroless deposition technique in the present work. AZO films with Al concentration from 1 at.% to 5 at.% are investigated for their structural and morphological properties by X-ray diffraction (XRD), and atomic force microscopy (AFM). An excellent homogeneity is achieved with average crystallite sizes of below 32 nm and a nearly constant root mean square (RMS) surface roughness between 1 nm and 3 nm, for various Al doping concentrations. These smooth and uniform films are characterized for their optical and photoluminescence (PL) properties. A higher value of average transparency between 79% and 92% in the wavelength range of 300-800 nm is achieved, and the PL intensity is found to be a strong function of doping. Density functional theory (DFT) calculations agree with the measured transmittance values, in addition to their predicted electronic structure. Moreover, time-resolved PL measurements indicate that the luminescence decay time decreases with increased doping concentration. © 2015 World Scientific Publishing Company.