Etching damage induced by inductively coupled plasma (ICP) with a mixture of Cl2 and BCl3 gases and the effect of subsequent annealing in N2were studied through positron annihilation and cathodoluminescence (CL) for Mg‐doped and Si‐doped GaN. The changes in the concentration of nonradiative defects and in the shape of band bending caused by ICP etching or subsequent annealing were studied by comparing the CL intensities and the diffusion lengths of implanted positrons, respectively. For Mg‐doped GaN, CL spectra revealed that etching inactivated the Mg acceptors at the near‐surface region. After annealing at 900 °C, the Mg acceptors were reactivated. For Si‐doped GaN, etching introduced neutral vacancy‐type defects, and after annealing at 900 °C, the etching‐induced defects almost disappeared. However, there were residual nonradiative defects on the top surface that were associated with a change in the surface's Fermi level position.