We investigated the surface chemistry and valence band (VB) structure of as-grown thin InN(0001)-2 × 2 films as well as their change upon the exposure to oxygen and water. The InN films were grown by plasma-assisted molecular beam epitaxy (PAMBE) and in situ characterized by reflection high electron energy diffraction (RHEED) and photoelectron spectroscopy (UPS, XPS). The oxygen and water exposure was directly performed on the as-grown, contamination-free InN surfaces at room temperature and leads to changes in the chemical surface states as well as the electronic properties. For 2 × 2 reconstructed InN surfaces one observes directly after growth a surface state at the Fermi-edge which decreases continuously with oxygen and water exposure. Furthermore, two oxygen related electronic states develop in the VB at binding energies at around 5 and 10 eV. For water exposure a third weak state around 8 eV is additionally observed. The impact of oxygen and water on the work function Φ as well as the variation of surface band bending was investigated. In both cases for initially 2 × 2 reconstructed surfaces a reduction in the downward band bending is found, while Φ increases in the case of oxygen exposure but in the case of interaction with water a reduced work function is observed. The oxygen uptake rates reveal a higher reactivity of water with InN surfaces compared to oxygen. Furthermore, during oxidation and water exposure different chemical oxygen bonds are formed, but a direct assignment to In–O or N–O bonds is difficult due to changes in the In3d and N1s XPS core level peak shape.