Multiwalled carbon nanotubes (MWCNTs) were simultaneously fluidized and oxidized with gaseous ozone in a vertical reactor. Two different varieties of MWCNTs were compared to determine the versatility of the treatment and to elucidate the effect of defects on the oxidation behavior of MWCNTs. The extent of oxidation and nature of functional groups introduced on the nanotube surfaces were determined using Fourier-transform infrared spectroscopy (FTIR), X-ray photoelectron spectroscopy (XPS), and Boehm titration, and structural changes were monitored with Raman spectroscopy, scanning electron microscopy (SEM), and transmission electron microscopy (TEM). After only a few minutes of treatment, nongraphitic impurities were removed from the MWCNTs, and significant levels of oxidation (∼8 atom % O) were achieved with very little damage to the nanotube sidewalls. Short O3 exposure resulted in primarily hydroxyl functionalities, whereas longer exposure led to the formation of mainly carboxylic acid groups. Aliphatic defects present in the commercially produced MWCNTs were found to play an important role in the oxidation mechanism. Because of its ability to remove impurities and to evenly oxidize the sidewalls of nanotubes without the use of any solvents, the fluidized O3 reaction developed in this study was found to be an attractive option for industrial-scale MWCNT functionalization.