We have investigated the effect of co-doping of nitrogen (N) acceptor impurity on the structural and magnetic properties of (Zn, Fe) Te. We grew (Zn, Fe) Te: N thin films by molecular beam epitaxy (MBE) with a fixed Fe composition 1.5% and varied N concentrations in the range of [N]= 8 x 10(17) - 4 x 10(19) cm(-3). Structural analyses by using x-ray absorption fine structure (XAFS) and transmission electron microscope (TEM) reveal that N-doped films with intermediate N concentration [N]= 8 x 10(17) - 7 x 10(18) cm(-3) are mainly composed of pure diluted phase with substitutional Fe atoms in the valence state deviated from Fe2+, while Fe is dominantly incorporated in an Fe-N compound at the highest N concentration [N]= 4 x 10(19) cm(-3). Accordingly, the magnetization measurement using SQUID confirms a drastic change of magnetic properties; a linear dependence of magnetization of magnetic field (M-H), typical of van-Vleck paramagnetism in the film without N-doping changes into ferromagnetic behaviors with a hysteretic M-H curves at the intermediate N concentrations and comes back to a linear M-H dependence at the highest N concentration. The ferromagnetism in the intermediate [N] range may reflect a deviation of the valence state of the substitutional Fe from Fe2+, while the linear M-H at the highest [N] would be attributed to precipitates of an Fe-N compound.