The conformational stability, infrared spectrum, and photochemistry of phenyl 1-hydroxy-2-naphthoate (PHN) were studied by matrix isolation infrared spectroscopy and theoretical computations performed at the DFT(B3LYP)/6-311++G(d,p) level of theory. The main intramolecular interactions determining the relative stability of seven conformers of the molecule were evaluated. According to the calculations, the twofold degenerated O–H···O=C intramolecularly hydrogen-bonded conformer with the phenyl ring ester group ±68.8° out of the plane of the substituted naphtyl moiety is the most stable conformer of the molecule. This conformer is considerably more stable than the second most stable form (by ~15 kJ mol−1), in which a weaker O–H···O–C intramolecular hydrogen bond exists. The compound was isolated in cryogenic argon and N2 matrices, and the conformational composition in the matrices was investigated by infrared spectroscopy. In agreement with the predicted relative energies of the conformers, the analysis of the spectra indicated that only the most stable conformer of PHN was present in the as-deposited matrices. The matrices were then irradiated at various wavelengths by narrowband tunable UV light within the 331.7–235.0 nm wavelength range. This resulted in the photodecarbonylation of PHN, yielding 2-phenoxynaphthalen-1-ol, together with CO. The extension of the decarbonylation was found to depend on the excitation wavelength.