Sol-gel derived composite materials of polyvinylpyrrolidone (PVP), SiO2 and TiO2 were studied to achieve low optical propagation loss and high thermal stability in slab waveguides. PVP is a thermally crosslinkable polymer. However, the thermal crosslinking and thermal decomposition take place around the same temperature, 200 °C, resulting in high optical propagation loss. The incorporation of sol-gel processed SiO2 prevents thermal decomposition of PVP and produces remarkably low optical propagation loss even after being baked at 230 °C. We have achieved 0.2 dB/cm optical propagation loss at 633 nm. Furthermore, little index change was observed at 110 °C for 1,000 hours after initial slight increase. Impregnation of sol-gel processed TiO2 into the PVP/SiO2 system was also studied to increase refractive index. A broad manipulation of refractive index, from 1.49 to 1.65, with an optical propagation loss of less than 0.6 dB/cm at 633 nm was accomplished by a careful selection of Ti alkoxide and optimized reaction conditions. PVP/SiO2 slab waveguides were then used to fabricate channel waveguides by using a laser densification technique utilizing metal lines as light absorbent and an Ar laser. An optical propagation loss of 0.9 dB/cm was achieved at 633 nm.