The present work reports on the synthesis of the Zn1-xMgxO (x - 0, 0.02, 0.05, 0.10, 0.15 and 0.20) samples by sol-gel method and the investigations on their structural, morphological and optical properties. X-ray diffraction (XRD) data analysis confirms the formation of pure ZnO phase below 10% Mg doping and MgO related phases appears in 10% doped sample indicating that phase segregation of MgO starts at x >= 0.10 samples. The phase segregation observed through XRD analysis is also supported by results from Scanning Electron Microscopy (SEM), Raman spectroscopy and photoluminescence studies. Furthermore, the enhancement in optical band gap, with Mg doping, from 3.1 +/- 0.1 eV to 3.5 +/- 0.1 eV has been observed through UV-Vis spectroscopic analysis. Above results have been discussed on the basis of defects level observed through Raman and photoluminscence studies. (c) 2012 Elsevier B.V. All rights reserved.