The structural characteristics of GaN films grown on sapphire substrates by molecular beam epitaxy have been investigated using high‐resolution synchrotron x‐ray diffraction and electron microscopy. We find remarkable correspondence between the in‐plane structural order (coherence length and mosaic spread) and the electrical and optical properties. Contrary to common belief, our observations show unequivocally that the out‐of‐plane structural features, which are considerably better developed than the in‐plane counterparts, cannot be used for determining the material quality with respect to their optical and electrical activity. In particular, the (00l) mosaic spread is not a good indicator of film quality.