The effects of thermal annealing for In0.25Ga0.75As1-yNy/GaAs multiquantum wells (MQWs) have been investigated through thermally detected optical absorption. The QW transition energies have been calculated by using a ten-band k-p model including the band anticrossing model for the description of the InGaAsN band gap variation. The modification of the In concentration profile due to In-Ga interdiffusion during thermal annealing is taken into account through the Fick law. A good agreement is obtained between calculated and experimental energies of optical transitions. Our results show that the In-Ga interdiffusion phenomenon observed in a nitrogen free sample is moderately enhanced by the introduction of nitrogen. The blueshift of optical transitions induced by the annealing process is the result of both In-Ga interdiffusion and rearrangement of local nitrogen environment.