Radio Frequency magnetron sputtering technique has been used to prepare Ni doped ZnO thin films with varying Ni doping concentration of upto 10 at.%. Grazing Incidence X-ray Diffraction results show wurtzite structure of the samples throughout the Ni concentration range while X-ray Near Edge Structure (XANES) and Extended Xray Absorption Fine Structure results at Zn and Ni K edges show that Ni is substituting Zn in ZnO lattice and no other extra phase is present in the samples. The substitution of Zn by Ni is further confirmed by O K-edge XANES measurements. Photoluminescence measurements on the samples and theoretical simulations of the XANES spectra at Ni and O K-edges have been used to explain the room temperature ferromagnetic character on the basis of the presence of oxygen vacancies in the samples.