A systematic analysis of how CH4/H2 based reactive ion etching affects the optical and electro‐optical properties of GaInAs/InP multiple quantum well pin diode strip‐loaded waveguides is reported. The study includes measurements of waveguiding properties, optical losses and electro‐optical phase modulation as function of etch depth, radio‐frequency (rf) power, pressure, and the CH4 content in the etch process. It is found that the optical losses of the waveguides are most sensitive to the etching conditions, in particular the rf power. As the rf‐power density was varied from 0.27 to 1.09 W/cm2, the optical losses increased from 6.8 to 19.6 dB/cm. The waveguiding and electro‐optical properties were found to be much less sensitive to the etching parameters. For a 5‐μm‐wide waveguide, the full width half‐maximum of the optical mode is typically 5 μm and the average voltage needed to produce a π phase shift is 4 V corresponding to a modulation response of 15°/V mm.