The inclusion compound formed between crosslinked alpha-cyclodextrin dimer and substituted oligothiophene, was investigated using density functional theory (DFT). Energy gap, spectroscopy (IR, UV-vis, (13)C NMR, and (1)H NMR) and first hyperpolarizability data were analyzed for the free species and inclusion compound, pp-PT@(alpha CD-alpha CD). The semiconducting property of the included pp-PT was not substantially affected on inclusion, with the energy gap increasing by only 10% after interaction with alpha CD-alpha CD. On the other hand, the nonlinear optical (NLO) response was significantly decreased, with the first hyperpolarizability, beta, predicted to be just more than 60% lower for the [2]rotaxane than for free pp-PT, but still having considerable magnitude. This was explained by the two-state model based on the charge-transfer contribution to the electronic transitions. The sensitivity of electronic spectra might also be useful for the inclusion complex characterization. The IR spectrum was slightly sensitive to the host-guest interaction and the calculated (13)C NMR and (1)H NMR chemical shifts for the pp-PT guest showed appreciable variations of 5-10 and 1-1.5 ppm, respectively, and so can be used for the characterization of inclusion compounds. We concluded that the formation of inclusion complexes with CDs, seems indeed very promising and the use of encapsulating conducting material should be experimentally pursued. (C) 2011 Wiley Periodicals, Inc. J Polym Sci Part B: Polym Phys 49: 1101-1111, 2011