Recent reports on Curie temperatures well above room temperature for a number of dilute magnetic oxides and nitrides have triggered an intensive research on these compounds. Such materials are expected to play a key role in the development of electronics using the electron spin rather than its charge as information carrier. Furthermore, the fundamental origin of the magnetic interactions in these materials is of great interest as the
m
‐J paradigm seems unable to explain the observed magnetic behavior. In this paper, we outline the main magnetic interactions in dilute magnetic oxides and show that an alternative approach is needed to explain and understand the phenomena, and also review a selection of possible candidates for high Curie temperature dilute oxides.