In this work, the mechanism of the NO₂ reaction with PEDOT-RGO composite film has been investigated via in situ Raman spectroscopy. Reduced graphene oxide (RGO), poly(3,4-ethylenedioxytiophene)-reduced graphene oxide (PEDOT-RGO) and poly(3,4-ethylenedioxytiophene)/ClO₄⁻ (PEDOT/ClO₄⁻) films were fabricated using an electrodeposition method and used as resistance sensors of gaseous nitrogen dioxide. The experimental results indicate that NO₂ causes overoxidation of the PEDOT polymer (PEDOT/ClO₄⁻ film) which leads to resistance increase and irreversible response. In contrast, the PEDOT-RGO response in the presence of NO₂ is reversible. During short NO₂ exposure, PEDOT from the PEDOT-RGO composite does not react to the gas but the presence of RGO in the PEDOT-RGO composite does not affect the overoxidation potential. It was found that the nitrogen dioxide reacts more readily to reduced graphene oxide, thus RGO “protects” the polymer against the adverse overoxidation process.