The chelating gadolinium-complex is routinely used as magnetic resonance imaging (MRI) -contrast enhancer. However, several safety issues have recently been reported by FDA and PRAC. There is an urgent need for the next generation of safer MRI-contrast enhancers, with improved local contrast and targeting capabilities. Cerium oxide nanoparticles (CeNPs) are designed with fractions of up to 50% gadolinium to utilize the superior MRI-contrast properties of gadolinium. CeNPs are well-tolerated in vivo and have redox properties making them suitable for biomedical applications, for example scavenging purposes on the tissue-and cellular level and during tumor treatment to reduce in vivo inflammatory processes. Our near edge X-ray absorption fine structure (NEXAFS) studies show that implementation of gadolinium changes the initial co-existence of oxidation states Ce3+ and Ce4+ of cerium, thereby affecting the scavenging properties of the nanoparticles. Based on ab initio electronic structure calculations, we describe the most prominent spectral features for the respective oxidation states. The as-prepared gadolinium-implemented CeNPs are 3-5 nm in size, have r(1)-relaxivities between 7-13 mM(-1) s(-1) and show clear antioxidative properties, all of which means they are promising theranostic agents for use in future biomedical applications.