Disclosed is a carbon fiber of improved oxidation resistance, which has a specific volume resistance of at least about 1.2.times.10.sup.-3 ohm cm, and containing at least about 2 wt. % of nitrogen and less than about 0.07 wt. % of total metal impurities. The carbon fiber is produced by using as the precursor fiber an acrylonitrile copolymer fiber, which copolymer is comprised of at least 95 mole % of units derived from acrylonitrile and not more than 5 mole % of units derived from a carboxyl group containing monoethylenically unsaturated monomer or monomers; the hydrogen atom of at least one --COOH contained in each of the units derived from the carboxyl group-containing monomer or monomers being replaced with a cation selected from ##STR1## wherein R is H, (C1-3) alkyl or phenyl; the replacement being to such an extent that the units having the cation occupy at least 0.1 mole %, based on the copolymer; and which copolymer contains less than about 0.05 wt. % of the total metal impurities. All of the aqueous baths used in the course of producing the carbon fiber, i.e., aqueous coagulating, drawing, washing and oiling baths, are prepared from deionized or distilled water, and the aqueous oiling bath is prepared by using a cationic or nonionic oiling agent.