Ultrafast time-resolved electronic absorption spectroscopy has been used to study the photochemistry of transazobenzene and trans-1, a derivative in which azobenzene is capped by an azacrown ether, on UV excitation to the S-2(pi pi*) state. Excitation of trans-1 results in transient absorption which decays with a dominant component of lifetime ca. 2.6 ps and in bleaching of the ground-state UV absorption band which recovers on a similar time scale. In contrast, excitation of trans-azobenzene results in transient absorption which decays with a dominant component with a shorter lifetime of ca. 1 ps, and in bleaching which recovers on a much longer time scale of ca. 18 ps. The recovery of the ground-state UV absorption band is not complete in either case, and the ultrafast data indicate that the quantum yield of trans-to-cis photoisomerization of 1 is approximately twice that of azobenzene. These observations demonstrate that the restricted rotational freedom of the phenyl groups in trans-1 has a significant effect on the excited-state dynamics and decay mechanism. The differences in lifetime and quantum yield of photoisomerization are attributed to rapid internal conversion from the S-2 to S-1 excited states of trans-1, which results in photoisomerization by an inversion mechanism in the S-1 state, whereas fast rotation in the S-2 State of trans-azobenzene populates a "bottleneck" state which delays the recovery of the ground state and which reduces the yield of photoisomerization; this "bottleneck" state is not accessible by trans-1. The results support the proposal that rotation is the dominant pathway for decay of the first-formed S-2 State of trans-azobenzene but that inversion is the dominant pathway for decay of the S-1 state.