Chemical functionalization of graphene is promising for a variety of next-generation technologies. Although graphene oxide (GO) is a versatile material in this direction, its use is limited by the production of metastable, chemically inhomogeneous and spatially disordered GO structures under current synthetic protocols, which results in poor optoelectronic properties. Here, we present a mild thermal annealing procedure, with no chemical treatments involved, to manipulate as-synthesized GO on a large scale to enhance sheet properties with the oxygen content preserved. Using experiments supported by atomistic calculations, we demonstrate that GO structures undergo a phase transformation into prominent oxidized and graphitic domains by temperature-driven oxygen diffusion. Consequently, as-synthesized GO that absorbs mainly in the ultraviolet region becomes strongly absorbing in the visible region, photoluminescence is blue shifted and electronic conductivity increases by up to four orders of magnitude. Our thermal processing method offers a suitable way to tune and enhance the properties of GO, which creates opportunities for various applications.