We report on the large photoluminescence redshift observed in nanostructures fabricated using n-type GaN by ultraviolet (UV) metal-assisted electroless chemical-etching method. The scanning electron microscopy (SEM) characterization showed nanostructures with size dispersion ranging from 10 to 100 nm. We observed the crystalline structure using high resolution transmission electron microscopy (HRTEM) and electron energy loss (EELS) techniques. In contrast to 362 nm UV emission from the GaN epitaxy, the nanostructures emitted violet visible-light in photoluminescence (PL) characterization with increasing optical excitation. An energy band model was presented to shed light on the large PL redshift under the influence of surface states, which resulted in two competing photoluminescence mechanisms depending on excitation conditions.