The structure and stability of different forms of salicylic acid dimer have been examined by Hartree-Fock and density functional theoretic calculations using 6-31G(d,p) and 6-311++g(d, p) basis sets. Vertical excitation energies for the monomer as well as the dimer have been computed using the time-dependent density functional theory using 6-311++G(d, p) basis set. The predicted absorption maxima for the first excited singlet state of salicylic acid monomer and the dimer of the primary form are in reasonable agreement with the experimental result. There is a slight red shift (similar to 6 nm) in the absorption maximum in going from the monomer to the dimer, in accord with the experimental observation. Configuration-interaction calculations including single excitation have been carried out to map the potential-energy profile for the intra-as well as the intermolecular proton transfer in different forms of the dimer. The barrier for proton transfer in the ground state as well as the excited states makes it clear that most of the processes take place in the primary form and largely by intramolecular proton transfer.