Titanium dioxide (TiO2) films are deposited on quartz substrates by atmospheric pressure (AP)CVD, and then annealed under simulated air (80% nitrogen, 20% oxygen) at temperatures from 600 to 900 °C to investigate the change in microstructure and the effect on the photocatalytic activity on the simulated pollutant stearic acid. The as-deposited TiO2 film is mainly composed of pure anatase phase while the rutile phase is detected only after annealing the film at 900 °C for 1 h. The photocatalytic activity of the annealed films on stearic acid under UV irradiation is found to deteriorate after the films are annealed at temperatures above 700 °C. This decrease in photocatalytic performance is observed to be the result of two possible mechanisms induced by the annealing temperature. The first mechanism is the increase in defect concentration (O− and Ti vacancies) in the annealed TiO2 films for annealing temperatures below 800 °C, and the second mechanism is the formation of large rutile grains at a higher temperature, 900 °C.