The electronic structure of azulene molecule has been studied. We have obtained the optimized structures of ground and singlet excited states by using the complete active space self-consistent-field (CASSCF) method, and calculated vertical and 0-0 transition energies between the ground and excited states with second-order Moller-Plesset perturbation theory (CASPT2). The CASPT2 calculations indicate that the bond-equalized C-2v structure is more stable than the bond-alternating C-s structure in the ground state. For a physical understanding of electronic structure change from C-2v to C-s, we have performed the CASSCF calculations of Duschinsky matrix describing mixing of the b(2) vibrational mode between the ground (1A(1)) and the first excited (1B(2)) states based on the Kekule-crossing model. The CASPT2 0-0 transition energies are in fairly good agreement with experimental results within 0.1-0.3 eV. The CASSCF oscillator strengths between the ground and excited states are calculated and compared with experimental data. Furthermore, we have calculated the CASPT2 dipole moments of ground and excited states, which show good agreement with experimental values. (C) 2004 American Institute of Physics.