The ability to study oxidation, reduction, and other chemical transformations of nanoparticles in real time and under realistic conditions is a nontrivial task due to their small dimensions and the often challenging environment in terms of temperature and pressure. For scrutinizing oxidation of metal nanoparticles, visible light optical spectroscopy based on the plasmonic properties of the metal has been established as a suitable method. However, directly relying on the plasmonic resonance of metal nanoparticles as a built-in probe to track oxidation has a number of drawbacks, including the loss of optical contrast in the late oxidation stages. To address these intrinsic limitations, we present a plasmonic heterodimer-based nanospectroscopy approach, which enables continuous self-referencing by using polarized light to eliminate parasitic signals and provides large optical contrast all the way to complete oxidation. Using Au–Cu heterodimers and combining experiments with finite-difference time-domain simulations, we quantitatively analyze the oxidation kinetics of ca. 30 nm sized Cu nanoparticles up to complete oxidation. Taking the Kirkendall effect into account, we extract the corresponding apparent Arrhenius parameters at various extents of oxidation and find that they exhibit a significant compensation effect, implying that changes in the oxidation mechanism occur as oxidation progresses and the structure of the formed oxide evolves. In a wider perspective, our work promotes the use of model-system-type in situ optical plasmonic spectroscopy experiments in combination with electrodynamics simulations to quantitatively analyze and mechanistically interpret oxidation of metal nanoparticles and the corresponding kinetics in demanding chemical environments, such as in heterogeneous catalysis.