We investigated the effects of oxygen on the optical properties of wet-chemically synthesized colloidal CdSe quantum wires using confocal spectroscopy. By comparing the photoluminescence characteristics of CdSe quantum wires in oxygen and in inert gas atmospheres, we observed both irreversible photoluminescence enhancement and quenching processes in oxygen as well as reversible changes in the emission spectra and Raman spectra when changing the gas atmosphere during continuous excitation. We attribute the irreversible photoluminescence enhancement to reduction of Auger recombination by formation of oxides on the surface, which eventually leads to photoluminescence quenching. The reversible atmosphere-dependent changes in the emission intensity and wavelengths, accompanied by changes in the Raman spectra, are attributed to electron scavenging by oxygen. This was demonstrated as the presence of excess negative charge carriers led to radiative emission of higher excited states and reduced Raman frequencies when illuminating in inert gas atmospheres. Thereby, this work provides insight into the possible photoinduced effects of oxygen on the optical properties of semiconducting nanoparticles and thus contributes to a more detailed understanding of photobrightening mechanisms.