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Optical nanocavities enhance light-matter interaction due to their high quality factors (Q) and small modal volumes (V). The control of light-matter interaction lies at the heart of potential applications for integrated optical circuits, including optical communication, quantum computation, biophotonics, and optical projection. Many of these applications could benefit from wide band gap III-nitride semiconductor material, which already forms the basis of industrial lighting technology based on blue light-emitting diodes. Cleanroom fabrication and optical spectroscopy comprise the laboratory work in this thesis. Air-suspended III-nitride nanocavities are fabricated using electron beam lithography, reactive ion etching, and vapor phase etching from thin (< 300 nm) III-nitride epilayers grown on silicon (111) substrates by metal-organic vapor phase epitaxy. An embedded single InGaN/GaN quantum well serves as an internal light source during micro-photoluminescence experiments. Strain and heating effects are analyzed by micro-Raman spectroscopy. A dedicated quantum optics laboratory is constructed in order to study nanocavities and quantum emitters in III-nitrides at short wavelengths (lambda < 500 nm). Photonic crystal nanocavities exhibit the highest figure-of-merit for light-matter interaction enhancement, Q/V. However, in contrast to silicon and gallium arsenide nanocavities working at telecommunication wavelengths, III-nitride based nanocavities underperform theoretical Q estimates by nearly three orders of magnitude at short wavelengths (lambda = 430 - 500 nm). This thesis accounts for this discrepancy by combined experimental and theoretical studies of nanobeam fabrication statistics. Surface state absorption is found to be the primary factor limiting Q at short wavelengths. Surface effects are studied in the microdisk resonator geometry. UV photoinduced desorption of oxygen gas from the III-nitride surface redshifts and broadens whispering gallery mode resonances over minute timescales. Oxygen desorption incurs additional optical absorption losses up to 100 cm^{-1}. The redshift and broadening is nearly reversible upon the introduction of oxygen into the measurement environment, implicating oxygen in passivation of the III-nitride surface. Finally, optimized surface passivation techniques using rapid thermal processing and conformal chemical vapor deposition more than double state-of-the-art Q of GaN-based microdisk resonators to beyond Q=10,000 in the blue spectral range. The results demonstrate the capabilities and limitations of III-nitride materials for optical nanocavities and photonic integrated circuits at short wavelengths.