Thin films of tin oxide mixed cerium oxide were grown on unheated substrates by physical vapor deposition. The films were annealed in air at 500 °C for two hours, and were characterized using X-ray photoelectron spectroscopy, atomic force microscopy and optical spectrophotometry. X-ray photoelectron spectroscopy and atomic force microscopy results reveal that the films were highly porous and porosity of our films was found to be in the range of 11.6–21.7%. The films were investigated for the detection of carbon monoxide, and were found to be highly sensitive. We found that 430 °C was the optimum operating temperature for sensing CO gas at concentrations as low as 5 ppm. Our sensors exhibited fast response and recovery times of 26 s and 30 s, respectively.