Abstract An efficient method to investigate the microstructure and spatial distribution of nitrogen and nitrogen‐vacancy (N‐V) defects in detonation nanodiamond (DND) with primary particle sizes ranging from approximately 3 to 50 nm is presented. Detailed analysis reveals atomic nitrogen concentrations as high as 3 at% in 50% of diamond primary particles with sizes smaller than 6 nm. A non‐uniform distribution of nitrogen within larger primary DND particles is also presented, indicating a preference for location within the defective central part or at twin boundaries. A photoluminescence (PL) spectrum with well‐pronounced zero‐phonon lines related to the N‐V centers is demonstrated for the first time for electron‐irradiated and annealed DND particles at continuous laser excitation. Combined Raman and PL analysis of DND crystallites dispersed on a Si substrate leads to the conclusion that the observed N‐V luminescence originates from primary particles with sizes exceeding 30 nm. These findings demonstrate that by manipulation of the size/nitrogen content in DND there are prospects for mass production of nanodiamond photoemitters based on bright and stable luminescence from nitrogen‐related defects.