Indium oxide (In2O3) and indium tin oxide (ITO) thin films have been investigated for high temperature thermocouple and strain guage applications. Reactive sputtering in nitrogen-rich plasmas was used to improve the high temperature stability of indium oxide-based films in air and scanning electron microscopy was used to follow the microstructural changes in the nitrogen-processed films. When thermally cycled at temperatures above 800 degrees C, a partially sintered microstructure comprised of nanometer-sized crystallites was revealed. A densified layer was also formed on the surface, which acted as an oxygen-diffusion barrier in the bulk film. This combined with a network of partially sintered oxynitride crystallites lead to considerable open porosity and a stabilizing effect on the ensuing electrical properties. In this article, the thermoelectric properties of nitrogen-processed films were evaluated at temperatures up to 1400 degrees C. To study the effect of nitrogen plasma processing on the sintering kinetics and associated densification, the constrained sintering of the resulting films was followed as a function of time and temperature. Based on the measured thermoelectric properties of the nitrogen processed films, drift rates on the same order of magnitude as commercial type K wire thermocouples were realized for these all-ceramic thermocouples.