A chiral azobenzene compound was synthesized, and mixing the chiral azobenzene compound in a host nematic liquid crystal (LC) induced a cholesteric phase. The twisting power of the trans-form of the chiral azobenzene compound was larger than that of its cis-form produced by ultraviolet irradiation. A low molecular weight compensated nematic LC was then prepared by mixing of the chiral azobenzene and a nonphotochromic chiral compound, thus giving mutual opposite helical sense in the host LC. Reversible optical switching between transparent and opaque was achieved by ultraviolet and visible light irradiation. However, the photochemically switched opaque state was not stable even in the dark. Stability of the opaque state was found to be improved by adding polymer LC to the low molecular weight compensated nematic LC. (C) 2004 Wiley Periodicals, Inc.