We have investigated the microstructure of epitaxial YBa2Cu3O7−x thin films on SrTiO3(100), LaGaO3(100), and LaAlO3 (100) with particular emphasis on how the final microstructure is developed. Cross‐sectional transmission electron microscopy as well as plan‐view transmission electron microscopy combined with sputter depth profiling were used to study the change in microstructure with the increase in film thickness. For a thin film or near the substrate/film interface of a thick film, the YBa2Cu3O7−x film is composed primarily of grains oriented with c axis normal to the substrate surface and a small volume fraction of grains with c axis parallel to the substrate surface. As the film grows thicker, the c‐axis parallel grains increase in size and grow over the top of the c‐axis normal grains. The volume fraction of c‐axis parallel grains increases rapidly as the film thickness increases and eventually the entire film surface is covered by c‐axis parallel grains. However, the number density of the c‐axis parallel grains remains constant throughout the whole film thickness. A growth model is proposed to explain the observed microstructure. Based on this model, a computer simulation is carried out. The simulated microstructure agrees well with the experimental result.