TlGaSe2 and TlGaSe2:Gd single crystals were grown by the Stockbarger method. There are no cracks or voids on the surface of ingots. The samples were cleaved along the cleavage planes (001). The freshly cleaved crystals had mirror-like surfaces even before using mechanical treatment. The phonon energies in TlGaSe2 and TlGaSe2:Gd have been calculated as (35.7 ± 4) and (38.3 ± 4) meV at 200 K, respectively. At 10 K, the direct band gaps of TlGaSe2 and TlGaSe2:Gd are 2.293 and 2.297 eV and the indirect bandgaps are 2.196 and 2.106 eV, respectively. There is an abrupt change in the energy spectrum of TlGaSe2 and TlGaSe2:Gd in the temperature ranges 105–115 and 210–215 K, respectively. The values obtained from the energy peak change may be related phase transition temperatures. The defect levels were found to be at 2.162, 2.143, 2.136 and 2.108 eV for TlGaSe2:Gd at 10, 100, 200 and 300 K, respectively. The defect levels, which exist in TlGaSe2:Gd, but not in pure TlGaSe2 can be observed by adding Gd in the temperature range of 10–320 K. The steepness parameters and Urbach energies for TlGaSe2 and TlGaSe2:Gd samples increased with increasing sample temperature in the range of 10–320 K. The other important results obtained are: (i) the defect levels and defect absorption peaks due to Gd which have been observed (figure 9(b)). (ii) Gd and Gd related defect levels which exist in Gd-doped TlGaSe2 and can be observed by adding Gd in the range of 10–320 K. Adding of the rare earth elements to the TlGaSe2 causes the new appearance and changing of the absorption peak intensity (figure 9(b)).