Large lattice mismatch between GaN and α-Al2O3 (15%) leads to the possibility of high threading dislocation densities in the nitride layers grown on sapphire. This investigation focused on defect reduction in GaN epitaxial thin layer was investigated as a function of processing variables. The microstructure changes from threading dislocations normal to the basal plane to stacking faults in the basal plane. The plan-view TEM and the corresponding selected-area diffraction patterns show that the film is single crystal and is aligned with a fixed epitaxial orientation to the substrate. The epitaxial relationship was found to be (0001)GaN∥(0001)Sap and [01-10]GaN∥[-12-10]Sap. This is equivalent to a 30° rotation in the basal (0001) plane. The film is found to contain a high density of stacking faults with average spacing 15 nm terminated by partial dislocations. The density of partial dislocations was estimated from plan-view TEM image to be 7×109 cm−2. The cross-section image of GaN film shows the density of stacking faults is highest in the vicinity of the interface and decreases markedly near the top of the layer. Inverted domain boundaries, which are almost perpendicular to the film surface, are also visible. The concentration of threading dislocation is relatively low (∼;2×108 cm−2), compared to misfit dislocations. The average distance between misfit dislocations was found to be 22 Å. Contrast modulations due to the strain near misfit dislocations are seen in high-resolution cross-sectional TCM micrograph of GaN/α-Al2O3 interface. This interface is sharp and does not contain any transitional layer. The interfacial region has a high density of Shockley and Frank partial dislocations. Mechanism of accommodation of tensile, sequence and tilt disorder through partial dislocation generation is discussed. In order to achieve low concentration of threading dislocations we need to establish favorable conditions for some stacking disorder in thin layers above the film-substrate interface region.