The effect of microstructures on noise level in ultrasonic testing of TC4 titanium alloy was investigated. A comparative study of microstructures for different noise levels was performed using optical microscopy. A new characterization of microstructure inhomogeneity was developed and used to explain the reason for different noise levels. The EBSD technique was used to provide orientation information about these inhomogeneous microstructures. Results show that the region with high noise level presents obvious microstructure inhomogeneity. With the principle of ultrasonic testing, it is concluded that the variation of crystallography orientation would essentially give rise to the noise in ultrasonic testing. Finally ultrasonic response of TC4 alloy with different β grain sizes was investigated, and it is shown that the specimen with more microstructure interfaces exhibits a higher noise level