P-type active incorporation of magnesium into the gallium nitride lattice is still a challenge for the realization of wide band gap light emitters. This work presents a detailed microstructural study of phenomena connected with the problem of Mg doping of films grown by metal organic vapor phase epitaxy. Transmission Electron Microscopy both in conventional and in high resolution mode are used to obtain a better understanding of the Mg related defect formation processes. It is shown that the defect formation never occurs instantaneously at the beginning of the doping but a defect free zone always precedes the onset of the defect formation. This effect cannot solely be addressed to the memory effect of the reaction chamber since it is found that the defect density oscillates during growth. A more detailed investigation reveals that segregation of Mg plays a crucial role in the formation of defects. The observations emphasize the fact that a critical surface concentration is necessary for the defects to form. Beside the known processes of inversion boundary formation it is found that small nitrogen polar GaN grains in GaN films are gradually increasing on the expense of Ga polar grains if a sufficiently high Mg coverage and film thickness is realized. This process is found to occur in alternating steps along the {1123} and {0001}planes.