A possible approach for enhancement of Poly(vinyl alcohol) (PVA) humidity-sensing performance using hydrophobically modified PVA copolymers is studied. Series of poly(vinylalcohol-co-vinylacetal)s (PVA–Ac) of acetal content in the range 18%–28% are synthesized by partial acetalization of hydroxyl groups of PVA with acetaldehyde and thin films are deposited by spin-coating using silicon substrates and glass substrates covered with Au–Pd thin film with thickness of 30 nm. Sensing properties are probed through reflectance measurements at relative humidity (RH) in the range 5%–95% RH. The influence of film thickness, post-deposition annealing temperature, and substrate type/configuration on hysteresis, sensitivity, and accuracy/resolution of humidity sensing is studied for partially acetalized PVA copolymer films, and comparison with neat PVA is made. Enhancement of sensing behavior through preparation of polymer–silica hybrids is demonstrated. The possibility of color sensing is discussed.