The present work reports synthesis, characterization and theoretical insights on novel hydroxymethyl‐bishomocubanone derivatives. Twelve new bishomocubanes (BHCs) were synthesized and fully characterized by various spectroscopic techniques and single crystal X‐ray analysis. The densities of the title compounds were found in the range of 1.34‐1.59 g/cm3. Density‐functional theory (DFT) based calculations at B3LYP/6‐311++G(d,p) level of theory were performed on ten selected BHC based cage compounds. Propulsive and ballistic properties of newly synthesized hydroxymethyl‐bishomocubanone derivatives in solid and liquid propulsion systems were calculated, and the results suggested that these compounds are superior to conventional fuel RP1 and binder HTPB. The detonation parameters revealed that these compounds are not explosive in nature and safe to use as solid propellants. Furthermore, kinetic and thermal stabilities of the title compounds were determined by HOMO‐LUMO energy gap, ESP maps, impact sensitivity (h50) and bond dissociation energies (BDEs) followed by thermogravimetric analysis (TGA) and differential thermogravimetry analysis (DTA). Three compounds, a dinitroazide (Isp,vac= 310.98s), a dinitrate (Isp,vac = 309.51s), and a dinitronitrate (Isp,vac= 309.20s) were found to be excellent candidates for volume limited applications.