We investigated the microstructure of phase change optical disks subjected to various initialization conditions using transmission electron microscopy (TEM). The effects of initialization powers on the erase ratio of phase change optical disks and corresponding microstructure changes were also studied. It was found that the increase of initialization power enlarged the width of the recrystallization band formed in the recording media of the disk. A wide recrystallization band was effective for decreasing the residual signal level hence the erase ratio increased. Disk dynamic test and TEM study results also revealed the deterioration of carrier-to-noice ratio (CNR) characteristic and the increasing trend of erase ratio was reduced when a substantial amount of coarse grains appeared in the crystalline region. This elucidates the necessity for phase change optical disks to have good heat dissipation property in order to suppress the formation of coarse granular structures.