Learn Spanish (Latin America): Dijeron que el profesor no envejecía, sino que estaba canoso. - They said that the teacher wasn't aging, but that he was gray-haired.

This is an example of reported speech. Because the reporting verb dijeron (they said) is in the past tense, the original statements shift one step back in time. The original direct quote was likely in the present tense: "El profesor no envejece, sino que está canoso" (The teacher isn't aging, but rather is gray-haired). When reported later, those present tense verbs shift to the imperfect.

Why does the sentence use sino que instead of pero?

We use sino to mean "but rather" when we are correcting a negative statement. Here, they deny that he was aging (no envejecía) and replace it with the contrasting fact that he was just gray-haired. We must add que because the contrasting idea contains a conjugated verb (estaba). If the second part didn't have a newly conjugated verb, we would just use sino (for example: No es rubio, sino canoso).

Why use estaba canoso instead of era canoso?

While ser is generally used for permanent physical characteristics, estar is frequently used with adjectives of physical appearance to emphasize a current state, a condition, or the result of a change. Using estaba canoso highlights how he looked at that specific time, focusing on the gray hair as an acquired state rather than an inherent identity trait.