An in situ optical microspectroscopy study of the surface plasmon resonance (SPR) evolution of Ag nanoparticles (NPs) embedded in thick SiO₂ films deposited on soda-lime glass has been conducted during thermal processing in air. The temperature and time dependences of the SPR were analyzed in the context of Mie extinction and crystal growth theories and were discussed along with consideration of oxidation processes and film/substrate physicochemical interactions. At relatively high temperatures, Ag NPs were indicated to grow first through a diffusion-based process and subsequently via Ostwald ripening. At lower temperatures, an initial decrease in Ag particle size was indicated due to oxidation, followed by NP diffusion-based growth. The growth and oxidation stages appeared temperature and time dependent, allowing for the tuning of material properties. The product of Ag NP oxidation was revealed by photoluminescence spectroscopy performed ex situ as single Ag⁺ ions. The oxidative effect of the air atmosphere on Ag NPs was shown to be ultimately circumvented by the thick nanocomposite film. The phenomenon was explained on the basis of the displacement of the Ag/Ag⁺ redox equilibrium toward Ag NP stability after ion migration toward the substrate being self-constrained. In addition, the current spectroscopic approach has been proposed for estimating the activation energy for silver diffusion in the SiO₂ matrix.