O'Neill confirmed that Wilson will not play a part in this summer's tournament after the Stoke City defender suffered a set-back to a knee injury and admitted that Duffy had "come to the fore" this season.
The 24-year-old Derry native impressed in Ireland's 1-0 win over Switzerland at the end of March, providing the assist for Ciaran Clark's winning goal and the Ireland boss noted that his aerial threat was an asset.
"I don’t want to heap an awful lot of expectation on him but I think he’s done fine," O’Neill told the Irish Times.
"I also think that he displayed against Switzerland that he can be a threat in the opposition box too. But I don’t want to put everything into one game; he has played all season as well."
Duffy, who began his career at Everton before making a permanent switch to Ewood Park two seasons ago, was retained as O'Neill trimmed his 35-man provisional squad to 31, keeping his place ahead of Reading's Paul McShane and Derby County defender Alex Pearce.
The Boys in Green boss added: "Paul [McShane] was obviously disappointed but I think he feels that the other players are in front of him at this minute.
"And I have to say that young Duffy has come to the fore and done really fine."
Duffy made 42 appearances in all competitions for Blackburn this season, finding the net on four occasions.