Present study reports the role of surface and subsurface defects in amorphous and polycrystalline MgO thin films. The amorphous film exhibits magnetization of the order of 179emu/cc at room temperature, however, this value is almost 10 times smaller than the value for polycrystalline MgO film. SEM-EDX and RBS studies reveal the absence of magnetic impurities in both films. Observed magnetic properties seem to be originated from the surface states as evidenced by X-ray absorption near edge fine structure study and in correlation with the existing theories of do ferromagnetism in similar oxides