Poly vinyl alcohol (PVA) capped CdSe nanoparticles having size in the range of 7–17 nm have been synthesized through chemical route and characterized using X-ray diffraction (XRD) and transmission electron microscopy (TEM). Positron coincidence Doppler broadening (CDB) measurements have been carried out in these nanoparticles. It is observed that the electron momentum distributions show a variation in the core electron momentum region with the particle size. In order to examine the influence of defects, first principle calculations of electron momentum distributions in bulk CdSe and in the presence of Cd as well as Se vacancy defects have been performed. Comparison of experimental data with the calculated momentum distribution reveals the presence of Cd vacancy defects, the concentration of which decreases with the increase in the particle size. The present study also indicates possible Se enrichment on the surface of the nanoparticles with the decrease in the particle size.