Indium gallium tin oxide (IGTO) thin films have the potential for high mobility and low-temperature processing, which makes them suitable for applications such as display backplanes and high-voltage switching devices. However, very few studies have investigated the plasma-etching characteristics of IGTO and changes in its properties after etching. In this study, the etching characteristics of IGTO were investigated using Cl2/Ar plasma, and changes in surface properties were analyzed. Results showed that the etch rate increased with an increase in the proportion of Cl2, with the highest etch rate observed at 69 nm/min in pure Cl2 plasma with a gas flow rate of 100 sccm. Furthermore, increased radio-frequency power caused a rise in the etch rate, while a process pressure of 15 mTorr was optimal. The primary etching mechanism for IGTO thin films under Cl2 plasma was a chemical reaction, and an increased work function indicated the occurrence of defects on the surface. In addition, the etching process reduced the surface roughness of Cl2-containing plasma, whereas the etching process in pure Ar plasma increased surface roughness. This study contributes to a better understanding of the plasma-etching characteristics of IGTO and changes in its properties after etching, providing valuable insights for IGTO-based applications.