Molecular dynamics simulations on condensed systems of dimers and tetramers of p-hydroxybenzoic acid (HBA) are reported. A nematic liquid crystalline phase was observed in the simulations of a system of tetramers, while an isotropic phase was found for dimers. The simulations were started from a configuration with limited order. This configuration was obtained by compressing a low-density initial structure in which the distribution of the angle between the long molecular axis and the director was in accordance with the results from mean field theory. The order parameter found for the nematic phase after relaxation is unexpectedly high, a fact which is discussed extensively and compared to standard theories for the formation of liquid crystals. The molecular self-diffusion and the distribution of the torsional angles of the ester group were determined. In the liquid crystalline environment, a coplanar arrangement of the phenyl rings is slightly more favorable than in isolated molecules, but in general the torsional angle distributions of the condensed phase are similar to the results obtained in vacuum simulations. This demonstrates that the internal motions, which do not influence the shape of this rodlike molecule without spacer groups, are not influenced by the liquid crystalline environment.