Electron paramagnetic resonance (EPR), X-ray photoelectron spectroscopy (XPS), and density functional theory (DFT) calculations are combined for the first time in an effort to characterize the paramagnetic species present in N-doped anatase TiO₂ powders obtained by sol−gel synthesis. The experimental hyperfine coupling constants are well reproduced by two structurally different nitrogen impurities:  substitutional and interstitial N atoms in the TiO₂ anatase matrix. DFT calculations show that the nitrogen impurities induce the formation of localized states in the band gap. Substitutional nitrogen states lie just above the valence band, while interstitial nitrogen states lie higher in the gap. Excitations from these localized states to the conduction band may account for the absorption edge shift toward lower energies (visible region) observed in the case of N-doped TiO₂ with respect to pure TiO₂ (UV region). Calculations also show that nitrogen doping leads to a substantial reduction of the energy cost to form oxygen vacancies in bulk TiO₂. This suggests that nitrogen doping is likely to be accompanied by oxygen vacancy formation. Finally, we propose that the relative abundance of the two observed nitrogen-doping species depends on the preparation conditions, such as the oxygen concentration in the atmosphere and the annealing temperature during synthesis.