Context. The Red Rectangle proto-planetary nebula (HD 44179) is known for a number of rather narrow emission features superimposed on a broad extended red emission (ERE) covering the 5000-7500 Å regime. The origin of these emission features is unknown. Aims. The aim of the present work is to search for potential carriers by combining new observational and laboratory data. This also allows to interpret spectral emission features in terms of actual physical conditions like temperature and density constraints and to trace chemical processes in the outflows of the Red Rectangle. Methods. Observational spectra have been obtained with the EMMI-NTT at offsets of 3 , 6 , 7 , 11 , 16 and 20 distance to the central star HD 44179. The spectra are compared to the outcome of a time-gated laser induced fluorescence laboratory study of an expanding acetylene plasma using a special supersonic pin-hole discharge source. With this set-up the hydrocarbon chemistry in the Red Rectangle nebula is simulated under laboratory controlled conditions. The plasma source has the unique feature to generate electronically and vibrationally excited species at low rotational temperatures. The comparison is facilitated by a simple model for fluorescent emission in the nebula. Results. Two of the astronomically observed narrow emission bands can be assigned as originating from unresolved rovibronic progressions within the d 3 Π g → a 3 Π u Swan system of the C 2 radical. The band appearance corresponds to a rotational temperature between 200 and 1000 K. The emission is driven by absorption in the C 2 Phillips bands followed by intersystem crossing from the singlet to the triplet state and pumping in the Swan bands. Conclusions. These observations imply an active (photo)chemistry in the ejecta of the Red Rectangle.