The efficiency and operational characteristics of the (CdZn)S/CuInSe2 heterojunction solar cell are significantly improved as a result of a postfabrication heat treatment in an oxygen containing environment. The effects of this critical annealing process on the microchemical and microelectrical properties of the various cell layers and interfaces are investigated. Time-resolved EBIC and laser scanning techniques are correlated with cell performance data to identify two separate mechanisms that affect cell response. High resolution SIMS is used to evaluate compositional changes and interdiffusion effects, showing that penetration of the Cu-ternary layer by the oxygen is minimal. Light and dark current–voltage characteristics and diagnostic spectral response data are used to explain changes in cell operation.