This study presents the optical properties of layered ZnO/Al/ZnO composite thin films that are being explored for potential applications in solar cells and light emitting devices. The composite thin films are explored as alternatives to ZnO thin films. They are produced via radio frequency magnetron sputtering. The study clarifies the role of the aluminum mid-layer in a ZnO (25 nm)/Al/ZnO (25 nm) film structure. Multilayers with low resistivity ∼362 µΩ cm and average transmittances between ∼85 and 90% (in the visible region of the solar spectrum) are produced. The highest Haacke figure of merit of 4.72 × 10−3 Ω−1 was obtained in a multilayer with mid-layer Al thickness of 8 nm. The combined optical band gap energy of the multilayered films increased by ∼0.60 eV for mid-layer Al thicknesses between ∼1 and 10 nm. The observed shifts in the optical absorption edges to shorter wave lengths of the spectrum are shown to be in agreement with the Moss–Burstein effect.