Cadmium telluride is another prominent polycrystalline thin-film material. With a nearly ideal bandgap of 1.44 eV, CdTe also has a very high absorptivity. Although CdTe is most often used in PV devices without being alloyed, it is easily alloyed with zinc, mercury, and a few other elements to vary its properties. Like CIS, films of CdTe can be manufactured using low-cost techniques.

Also like CIS, the best CdTe cells employ a heterojunction interface, with cadmium sulfide (CdS) acting as a thin window layer. Tin oxide is used as a transparent conducting oxide and antireflection coating. One problem with CdTe is that p-type CdTe films tend to be highly resistive electrically, which leads to large internal resistance losses. A solution is to allow the CdTe layer to be intrinsic (that is, neither p-type nor n-type, but natural), and add a layer of p-type zinc telluride (ZnTe) between the CdTe and the back electrical contact. Although the n-type CdS and the p-type ZnTe are separated, they still form an electrical field that extends right through the intrinsic CdTe. When it comes to making CdTe cells, a wide variety of methods are possible, including closed-space sublimation, electrodeposition, and chemical vapor deposition.