Films of sphalerite structure CdTe grown on (100) faces of Ge were annealed in vacuum for 6 to 9 h at 400 °C. This greatly reduced the number of planar defects in the films and eliminated the streaks from their diffraction patterns. Similar annealing of the (0001) wurtzite‐structure films of CdTe grown on (111) surfaces of Ge had no effect on the structure of the CdTe films. Moire fringes with a 15 Å spacing were seen in transmission electron micrographs of as‐grown CdTe (111) Ge heterojunctions in regions in which equal thicknesses of CdTe and Ge overlapped. Instead of Moire fringes, lines with a 160 Å spacing were seen in these heterojunctions after annealing. This can be interpreted as a consequence of interdiffusion of the CdTe and Ge across the interface to form a graded heterojunction. Co‐evaporation of CdTe and 5 wt% of excess To produced a new type of planar {111} defect in the films grown on (100) Ge. The likelihood of structurla changes therefore must be taken into account when considering the effects of annealing on the electrical or optical properties of II–VI compounds, and of II–VI heterojunctions.