Microstructural defects (polarons, bipolarons), responsible for conduction in polypyrrole (PPy) has been studied using positron annihilation lifetime (PAL) spectroscopy, conductivity and electron spin resonance (ESR) measurements. Pyrrole, oxidized at different oxidizing strengths [0.13(N)-2.0(N)] by ammonium ferric sulphate has been used for the preparation of PPy. It is observed from the PAL measurement that of the two lifetime components the longer one originates from annihilation of positron in the defect (polaron and bipolaron) sites and the corresponding intensity is a measure of the defect concentration. Further it is evident from the ESR spectra that the dominant defects are polarons at lower oxidizing strengths [ less than or equal to 0.75(N)] and bipolarons at strengths greater than or equal to 1.0(N). Conductivity data corroborate the findings.