AlN ferromagnetic nanorods with 5 at.% of copper were studied by using x-ray absorption spectroscopy (XAFS) above the Cu K- and L3- edges. Theoretical simulations of XAFS spectra clearly identify a formation of small copper clusters inside AlN lattice. Average size of clusters was estimated to be 50–70 atoms from the analysis of both XANES (X-ray Absorption Near Edge Spectroscopy) and EXAFS (Extended X-ray Absorption Fine Structure) regions of spectra. Calculations of magnetic moments for different types of point copper defects in AlN lattice were made.