Indium nitride (InN) is a promising yet technologically challenging material with a high defect density and unusual material properties. Its high electron mobility may be utilized in high power electronic devices, and its high absorbance and low energy optical response make it a promising candidate for multi-junction, high-efficient solar cell technology. Studies of absorption and photoluminescence optical response of epitaxial InN resulted in a large correction of the fundamental bandgap from the originally proposed 1.9 eV to now below 0.7 eV. Yet, it is still debated if the commonly measured optical transitions below the original high bandgap values are actually caused by a large concentration of defects, on the order of 1020/cm3, rather than reflecting a low fundamental bandgap. Many applications of this material, e.g. in high-efficient solar cell technology, are primarily dependent on the successful production of a contacted p-n junction, which has not yet been achieved. This contribution addresses the controversy in the bandgap discussion of InN. Valence electron energy loss spectroscopy (VEELS) of InN allows spatially resolved analysis of the density of states in the transmission electron microscope (TEM). Standard optical characterization is compared with results from TEM characterization.