The performance and stability improvement of back channel etched indium-gallium-zinc oxide thin-film transistors （IGZO TFTs） by optimized passivation layer was investigated. It was revealed that the positive threshold voltage （V_th） shift occurred under the positive gate bias stress （PBS）. Analysis showed that the permeated moisture could degrade TFT performance and aggravate the positive V_th shift under PBS. It was demonstrated that the optimized passivation layer could effectively improve the device performance and V_th stability. This improvement is attributed to lessen the traps caused by absorbance on back channel surface.