We report results on the processing and characterization of tellurite-based glass in the TeO2–Bi2O3–ZnO (TBZ) glass family and efforts to reduce their absorption loss due to residual hydroxyl (OH) content. We show that the introduction of alkaline or alkaline earth in the glass network, drying of the batch with fluorine-based raw materials before melting, and melting of the glass in O2-rich atmosphere can lead to a significant reduction in OH content. Employing these steps in TBZ glass processing resulted in a 93% reduction of OH content as compared with a reference composition. The reduction in OH content was verified by a decrease of the absorption band center at 3000 cm−1 as well as a decrease of the free volume in the glass. The addition of F in the glass network was found to reduce the fraction of nonbridging oxygen associated with OH. X-ray fluorescence spectrometry was used to determine the amount of remaining F.