The crystal structure of magnetite nanoparticles may be transformed to maghemite by complete oxidation, but under many relevant conditions the oxidation is partial, creating a mixed-valence material with structural and electronic properties that are poorly characterized. We used X-ray diffraction, Fe K-edge extended X-ray absorption fine structure (EXAFS) spectroscopy, and soft X-ray absorption and emission spectroscopy to characterize the products of oxidizing uncoated and oleic acid-coated magnetite nanoparticles in air. The oxidization of uncoated magnetite nanoparticles creates a material that is structurally and electronically indistinguishable from maghemite. By contrast, while oxidized oleic acid-coated nanoparticles are also structurally indistinguishable from maghemite, Fe L-edge spectroscopy revealed the presence of interior reduced iron sites even after a 2-year period. We used X-ray emission spectroscopy at the O K-edge to study the valence bands (VB) of the iron oxide nanoparticles, using resonant excitation to remove the contributions from oxygen atoms in the ligands and from low-energy excitations that obscured the VB edge. The bonding in all nanoparticles was typical of maghemite, with no detectable VB states introduced by the long-lived, reduced-iron sites in the oleic acid-coated sample. However, O K-edge absorption spectroscopy observed a 0.2 eV shift in the position of the lowest unoccupied states in the coated sample, indicating an increase in the semiconductor band gap relative to bulk stoichiometric maghemite that was also observed by optical absorption spectroscopy. The results show that the ferrous iron sites within ferric iron oxide nanoparticles coated by an organic ligand can persist under ambient conditions with no evidence of a distinct interior phase and can exert an effect on the global electronic and optical properties of the material. This phenomenon resembles the band gap enlargement caused by electron accumulation in the conduction band of TiO2.