Abstract An extensive examination of the nanoscale, crystallographic growth dynamics of the system, which is impacted by the thermal energy given to the GaN, is carried out to derive a deeper understanding of the growth kinetics, morphology and microstructure evolution, chemical bonding, and optical properties of Ga─O─N films. Thermal annealing of GaN films is performed in the temperature range of 900–1200 °C. Crystal structure, phase formation, chemical composition, surface morphology, and microstructure evolution of Ga─O─N films are investigated as a function of temperature. Increasing temperature induces surface oxidation, which results in the formation of stable β‐Ga 2 O 3 phase in the GaN matrix, where the overall film composition evolves from nitride (GaN) to oxynitride (Ga─O─N). While GaN surfaces are smooth, planar, and featureless, oxidation induced granular‐to‐rod shaped morphology evolution is seen with increasing temperature to 1200 °C. The considerable texturing and stability of the nanocrystalline Ga─O─N on Si substrates can be attributed to the surface and interface driven modification because of thermal treatment. Corroborating with structure and chemical changes, Raman spectroscopic analyses also indicate that the chemical bonding evolution progresses from fully Ga─N bonds to Ga─O─N. While the GaN oxidation process starts with the formation of β‐Ga 2 O 3 at an annealing temperature of 1000 °C, higher annealing temperatures induce structural distortion with the potential formation of Ga─O─N bonds. The structure‐phase‐chemical composition correlation, which will be useful for nanocrystalline materials for selective optoelectronic applications, is established in Ga─O─N films made by thermal treatment of GaN.