How can I solve the activation issue on my iPod touch (7th generation)?

Try this Apple article, which although it says it's for iPhones, I believe has steps that are relevant to the iPod Touch: If you can't activate your iPhone or iPad (Wi-Fi + Cellular) - Apple Support.

Important points to note:

1. if the message is referring to Activation Lock, which was put on by the previous owner, you will need to contact that owner
2. ensure that your iTunes programme is up to date (read the notes below)
   1. Windows 7: note that if you are using Windows 7 (or 8.1), iTunes will not be up to date, despite what the message in iTunes will tell you. The most recent version of iTunes is 12.10.11.2
   2. Windows 10: on the day of writing this the current version of iTunes (for Windows 10 or 11) is 12.13.6.1
   3. Mac OS Mojave or earlier: if you are using a Mac with OS Mojave(10:14) or later, use iTunes
   4. Mac OS Catalina or later: if you are using a Mac with OS Catalina (10:15) or later, there is no iTunes. Instead, use Finder

I have the same issue! A new itouch 7th gen that always says the activation server is temporarily unavailable. When the itouch appears in itunes on my laptop it says it can not be activated because the activation information is invalid.

I've spoken with an Apple rep who said it should be possible to activate it but didn't really have any answer; however the Apple service/Geek Squad guys at Best Buy said that since Apple no longer supports ipods, the activation servers are not actually online (even though they show up as being online).

I've been working for close to a month to figure out a solution, i've gone through all the steps suggested by Apple (and basically anyone else) and can't figure it out. I have an expensive nonreturnable brick at the moment, its so frustrating!

Is all your software up to date? Its one of the few things left I haven't tried. I'm a few updates behind (currently at Mojave 10.14.6/ itunes 12.9.5.5) but still current enough it should work. I only haven't updated everything since the next update is reinstalling a new OS X so thats a last resort.

No its not an activation lock where it's been locked to a specific user, it's a brand new itouch that can not be activated to function at all.

You start with a welcome set up screen, click your language, then it takes you to a screen to activate the itouch where it apparently tries over wi-fi to contact Apples activation server -the only message you receive on the itouch is "Unable to activate: the activation server is temporarily unavailable" When you plug it in to your computer directly it says "it can not be activated because the activation information is invalid"

@rrajji

 If the problem is activation lock, you will not be able use it without knowing the original ID and Password. See Activation Lock for iPhone and iPad - Apple Support

What happened when you tried? At which stage did you see nay error messages?

By the way, I think you will need to use the direct (cable) connection, not Wi-Fi.

Try checking if the iPod is locked by inputting the serial number into a site like iFreeiCloud