Cation exchange occurs via defect initiated solid-state diffusion, a process that can lead to defect formations. The effect of such inherent defect formation on carrier dynamics of cation-exchanged heterostructures remains poorly understood. Herein, we report exciton dynamics in type II CdSe/PbSe heterostructure nanorods formed via cation exchange. The majority of electrons in CdSe domains decays in 5 ps due to ultrafast carrier trapping. The defect generated by cation exchange can be healed by annealing the as-synthesized CdSe/PbSe heterostructure nanorods. This study suggests a strategy for improving properties of heteronanostructures prepared by cation exchange for applications in photovoltaics and photocatalysis.