Eu-doped AlN thin film has been prepared by radio frequency magnetron sputtering and studied focusing on its photoluminescence (PL) properties dependent on temperature. The resultant 0.4–0.8% of the Eu ion content is an appropriate concentration, with both trivalent Eu3+ and divalent Eu2+ ions being detected. The film also appears oxygen-rich with an optical bandgap redshifted to 5.8 eV, so, has been named as an inherently codoped AlN0.9O0.1:Eu2+/Eu3+. The film emits intense red light under UV excitation, where narrow intense lines from the excited level 5D0 of Eu3+ dominate in the spectra consisting of two bunches of intense peaks at 624 and 666 nm and several satellite peaks at 545, 585, 602 and 713 nm. Eu2+ manifests itself as a low-intense PL band at 430–570 nm. The PL excitation spectra containing wide UV bands allow to conclude the Eu excitation by nonradiative energy transfer (NRET) of two pathways: (i) from the resonant defect levels and vacancy-oxygen complexes in the AlN1–xOx host to Eu3+ ions and (ii) from O2− to Eu2+ (Eu–O pairs) with a subsequent NRET from Eu2+ to Eu3+. The temperature dependence of the thermally coupled levels 5D1 and 5D0 of Eu3+ ions is studied in detail from −160 to +250 °C and considered in terms of optical thermometry using the fluorescence intensity ratio (FIR) technique. At higher temperatures, the levels show an absolute sensitivity up to 0.003 K–1. Furthermore, applying a broadband multi-peak detection and the FIR of Eu2+/Eu3+, we have achieved much higher sensitivity up to 0.01 K–1. Such values are rather high, so AlN1–xOx:Eu2+/Eu3+ seems to be a promising material for non-contact optical thermometry.