Nitrous oxide (N₂O) is a potent greenhouse gas, and emissions from wastewater treatment plants (WWTPs) represent a significant and highly variable source. Understanding the dynamics in microbial pathways of N₂O formation and reduction during biological nitrogen removal is essential for targeted mitigation strategies. Stable isotope analysis of N₂O (δ¹⁵N^α, δ¹⁵N^β, δ¹⁸O, and ¹⁵N site preference) provides a powerful tool to disentangle and quantify N₂O production and reduction processes, yet conventional analytical approaches lack temporal resolution. Here, we present the first long-term application of an off-axis integrated cavity output spectrometer for real-time N₂O isotopic analysis at a pilot-scale WWTP over one year of operation. We developed a dynamic dilution system and implemented correction protocols for drift, N₂O mole fraction dependence, and gas matrix effects on isotopic results, achieving uncertainties of 0.85 ‰ (δ¹⁵N^α), 1.08 ‰ (δ¹⁵N^β), 0.81 ‰ (δ¹⁵N^bulk), 0.48 ‰ (δ¹⁸O) and 1.09 ‰ (¹⁵N site preference). Representative datasets demonstrate the system’s capability to (i) identify dominant N₂O production pathways under standard operation, (ii) quantify N₂O reduction in relation to dissolved oxygen concentration, and (iii) trace nitrogen transformation during low-level ¹⁵N-labelling experiments. Our results indicate nitrifier or heterotrophic denitrification as the main source of N₂O, and that N₂O reduction efficiency is strongly controlled by oxygen availability. This study highlights the potential of laser spectroscopy for continuous isotopic monitoring in real-world engineered systems and provides practical guidelines for uncertainty reduction and data interpretation. More specifically, our work forms a foundation for further investigations of the operational factors controlling N₂O formation and N₂O reduction in biological WWTPs and other complex anthropogenically-perturbed settings.