The photoluminescence spectra of liquid phase epitaxially (LPE) grown Hg0.3Cd0.7Te and its CdTe substrate have been measured. The CdTe spectra consist of two band‐edge sets of lines, B and C, while the Hg0.3Cd0.7Te spectra consist of one set of lines, A. From the temperature dependence of both the integrated intensity and peak position, we determined that the A line is unrelated to the C line but is very possibly related to the B line. The B line in CdTe is due to recombination of electrons and holes bound to a neutral donor. This suggests that the same neutral donor may be present in both materials, whereas the impurity or defect responsible for the C line in CdTe is undetectable in LPE‐grown Hg0.3Cd0.7Te.