Unpassivated AlGaN/GaN heterostructure field-effect transistors (HFETs) on freestanding GaN substrates show less electron accumulation in the gate-drain surface region than do comparable devices on Al2O3 substrates. This suggests that a significant portion of the degraded output power under large signal conditions is due to surface states associated with screw-type dislocations. Subsequent passivation by low-temperature (100degreesC) deposition of Sc2O3 layers by molecular beam epitaxy showed more dramatic improvements in drain current in HFETs on Al2O3 substrates than similar devices on GaN substrates and points to the advantage of using the latter for optimum device performance. (C) 2004 The Electrochemical Society.