Interfacing different transition-metal oxides opens a route to functionalizing their rich interplay of electron, spin, orbital, and lattice degrees of freedom for electronic and spintronic devices. Electronic and magnetic properties of SrTiO3-based interfaces hosting a mobile two-dimensional electron system (2DES) are strongly influenced by oxygen vacancies, which form an electronic dichotomy, where strongly correlated localized electrons in the in-gap states (IGSs) coexist with noncorrelated delocalized 2DES. Here, we use resonant soft-X-ray photoelectron spectroscopy to prove the e(g) character of the IGSs, as opposed to the t(2g) character of the 2DES in the paradigmatic LaAlO3/SrTiO3 interface. We furthermore separate the d(xy) and d(xz)/d(xz) orbital contributions based on deeper consideration of the resonant photoexcitation process in terms of orbital and momentum selectivity. Supported by a self-consistent combination of density functional theory and dynamical mean field theory calculations, this experiment identifies local orbital reconstruction that goes beyond the conventional e(g)-vs-t(2g) band ordering. A hallmark of oxygen-deficient LaAlO3/SrTiO3 is a significant hybridization of the e(g) and t(2g) orbitals. Our findings provide routes for tuning the electronic and magnetic properties of oxide interfaces through ``defect engineering{''} with oxygen vacancies.