In the present study, indium oxide nanoparticle films have been deposited using a two-step synthesis procedure. The first step consists of growing indium oxide nanoparticles by chemical capping method. X-ray diffraction, Fourier transform infrared spectroscopy, transmission electron microscopy, thermo gravimetric analysis and optical absorption measurements have been used to study the effect of post synthesis heat treatment on the size and structure of the nanoparticles. It has been found that indium hydroxide forms a shell structure around the indium oxide nanoparticles and gets completely converted to indium oxide at 238 C temperature. In the second-step, the nanoparticles having well-defined sizes have been used as a precursor for depositing nanoparticle films by a simple dip coating method. The structural, optical and electronic properties of these films show that these films have uniform and compact morphology, a well-connected nanoparticle structure and the initial nanoparticles size is preserved.