We present experimental studies of crystalline, magnetic, and magneto-optic (MO) properties and their correlation with the processing parameters of Ce-substituted yttrium iron garnet (CexY3−xFe5O12) thin films grown epitaxially onto single crystal Gd3Ga5O12 (111) substrates by Nd:YAG pulsed laser deposition technique. Rutherford backscattering (RBS) analysis and microprobe energy dispersive spectrometry (EDS) prove the background oxygen pressure, used for films growth, control films stoichiometry. Oxygen ambient pressure appears to be an important parameter to grow CexY3−x, Fe5O12 films with good crystallinity, magnetic properties, as well as enhanced MO effect. It is found that the film fabricated at 50 mTorr oxygen pressure exhibits a maximum Faraday rotation (FR) øF = 1.78 deg/νtm at λ = 633 nm, a maximum saturation magnetization 4πMs = 1255 Gauss with a minimum in-plane coercivity Hc = 35 Oe, and the narrowest full width at half maximum FWHM = 0.06° of the (444) Bragg reflection rocking curve. The analog of the Verdet constant V = øF / 4πMs, also found to be dependent on the oxygen ambient pressure, reaches the value as high as 1.4 deg/νm-kG at 633 nm, suggesting that this material is useful for MO applications.