YBa 2 Cu 3 O 7−x (YBCO) films grown by pulsed laser deposition on (100) LaAlO 3 substrates show a strong thickness dependence on the electrical properties. Films in excess of 0.3 μm show a critical current density that decreases with increasing thickness. In contrast, nano-composite films, consisting of a stack of alternative YBCO and (Ba 0.05 , Sr 0.95 )TiO 3 (BSTO) layers with a total thickness of up to 5 μm, show improved electrical properties. In order to understand this phenomenon, a detailed microstructural characterization has been undertaken. Transmission electron microscopy observations show that cracks, stacking faults and grain boundary are present on the single-layer films, while a high-quality microstructure is observed for the nano-composite multiple-layer films although defects at YBCO/BSTO interfaces are still present. In addition, nano-composite films have a reduced surface roughness. In this complex microstructure, the digital Moiré technique reveals that the YBCO/BSTO interfaces play a crucial role in controlling the propagation of defects in YBCO.