Rapid thermal annealing (RTA) was applied to polycrystalline CdTe thin films evaporated on CdS/ITO/glass substrate and the effect of the annealing temperatures and the atmosphere on physical properties of polycrystalline CdTe thin films and CdTe/CdS solar cell characteristics were studied. Results obtained by EDX showed that the bulk composition of CdTe remained stoichiometric after annealing at $550^{circ}C$ in the air but the surface composition became Cd-rich. Cross-sectional TEM and micro EDX showed that columnar grains and micro-twins remained even after RTA, however, and the sulfur content in the annealed CdTe (added by sulfur diffusion from CdS during the annealing) was much smaller than that by furnace annealing. Among the investigated RTA temperatures and gas environments, the cell made with CdTe annealed at $550^{circ}C$ in air showed the best solar energy conversion efficiency.