The enhanced performance of a squaraine compound, 2,4-bis[4-(N,N-diisobutylamino)-2,6-dihydroxyphenyl] squaraine (SQ) as a donor, and [6,6]-phenyl-C71-butyric acid methyl ester (PC71BM) as an acceptor in solution processed organic photovoltaic devices (OPVs) via the anode modification and thermal annealing is investigated. Through the optimization of these two factors, a maximum power conversion efficiency (PCE) of 4.08% under AM 1.5 G illumination (100 mW/cm(2)) is obtained. The results show that poly (3,4-ethylenedioxythiophene): poly (styrenesulfonicacid) (PEDOT:PSS) deteriorates the performance of SQ: PC71BM based OPVs, and MoO3 is used to substitute PEDOT: PSS as an effective exciton-blocking layer. A higher open-circuit voltage (V-OC) of 0.95 V is reached. The barrier matching between the energy-level of MoO3 and HOMO of SQ enhances fill factor (FF) and short-circuit current density (J(SC)). The operation mechanism of the thermal annealing is also straightened out. The higher carrier mobility and improved contact is obtained under 70 degrees C annealing, which results from the higher nanoscale crystallinity and the optimal scale phase separation between donor-acceptor networks. Hence the balanced charge carrier mobility increases the FF and PCE of OPVs by decreasing the charge recombination. (C) 2013 The Authors. Published by Elsevier B. V. All rights reserved.