Using the full potential linearized augmented plane wave (FLAPW) method, we have explored the magnetic properties of ultrathin C and N layers on a MgO(001) surface. It has been found that the free standing C layer has a ferromagnetic (FM) ordering with a magnetic moment of 0.82 μ(B), while the free standing N layer with the same coverage displays an antiferromagnetic (AFM) state with a magnetic moment of 1.68 μ(B). Through a structure optimization procedure, we have found that both C and N adatoms are adsorbed on the O-top position in the presence of a MgO(001) surface. The ultrathin 0.25 monolayer coverage of C/MgO(001) film becomes a magnetic semiconductor and shows the c(2 × 2) AFM ground state with a magnetic moment of 0.62 μ(B). Surprisingly, the ultrathin N/MgO(001) manifests a half metallic state with a magnetic moment of 0.47 μ(B). In addition, the induced spin polarization in the O atom is found and this hybridization significantly affects the density of states (DOS) behavior. This peculiar DOS feature results in the opposite magnetic ground states of C and N layers on a MgO(001) surface. Additionally, it is found that the N/MgO(001) has a perpendicular magnetocrystalline anisotropy energy of 63 µeV. We also present theoretically calculated x-ray absorption spectroscopy (XAS) and x-ray magnetic circular dichroism (XMCD) results.