How can I make over this room into a TV room?

I would go with black out curtains to keep the light from glaring on the tv.

This site has some helpful ideas: https://www.topdreamer.com/the-best-ideas-of-how-to-decorate-a-small-tv-room/

More ideas: https://www.decoist.com/small-tv-rooms/

I would paint the walls so there aren't the two different colors like there is now. Add some nice curtains and have a tv installed on the wall. Are there two wall lamps on that wall? If there are, you can have a tv installed between those.

The possibilities are endless. Open the closet and install wood shelving to create a library that can hold baskets and books, cd’s, etc. Paint that area bright white. The walls look like they have been papered and uneven? ( might just be photo), strip that down if it’s pulling away!! Prime and paint a soft, rich color, you can go darker, like a slate grey; add trim around the window, make or purchase Roman shades ( can do a no sew version) using contrasting colors. Hang your TV, find a piece of furniture on freecycle.com grab a comfy studio sofa or loveseat for under $100 on same site or online garage sale( I got a gorgeous sleeper sofa in perfect shape, expensive manufacturer by watching until I found one for $140. Sells for close to $700. but people want to just MOVE things, it was a bite to move but worth the work!). I’d add big floor cushions for extra seating, small tables ( repurposed) and carpet to soften the whole area. This site has great ideas for painting, repurposing furniture... seriously , check out freecycle.com and then wait like a spider for the fly!!

In a small room you don’t need a gigantic television! Before purchasing, try to view different sizes from 8 Ft. (Your parameters). A too large screen can be overwhelming and hard to watch.

I would put the tv on the left side opposite the closet , the put a loveseat or 2 chairs opposite the tv , but leaving a few feet clear in front of the closet . If you aren't using the closet for anything in particular , you can make it over into a mini office area . You can put narrow bookshelves on either side of the window. Make sure you have a good quality window covering , to block out glare on the tv . You can paint the walls a different color and put a throw rug in the tv area to define the area .

Thanks to all!