This research work focuses on the synthesis, characterization through spectra (FT-IR, UV–vis, and 1H-NMR) investigations, and the use of density functional theory (DFT) along with time-dependent density functional theory (TD-DFT) to investigate the electronic, structural, reactivity, photophysical properties, and the photovoltaic properties of a novel (E)-6-(4-(dimethylamino)phenyl)diazenyl)-2-octyl-benzoisoquinoline-1,3-dione. The structure of the synthesized compound was modeled using the Gaussian09W and GaussView6.0.16 softwares employing B3LYP and 6–31 + G(d) basis set. The DFT studies was performed in order to investigate the Frontier Molecular Orbital (FMO), Natural Bond Orbital (NBO), charge distribution, Nonlinear Optics (NLO), and stability of the titled molecule. The HOMO–LUMO energy gap which corresponds to the difference between HOMO and LUMO energies of the studied compound was found to be 2.806 eV indicating stiff and smooth nature of the titled molecule. This accounts for the less stability and high chemical reactivity of the compound. The photovoltaic properties were conducted to evaluate the light harvesting efficiency (LHE), short circuit current density (JSC), Gibbs free energy of injection ($$\Delta {G}_{inj}$$
Δ
G
inj
), open cycled voltage (VOC) and Gibbs free energy regeneration ($$\Delta {G}_{reg}$$
Δ
G
reg
) and solar cell conversion efficiency. Interestingly, the results obtained were found to be in good agreement with other experimental and computational findings.