We have investigated the heretofore unknown unimolecular decomposition pathway of the explosive molecule diaminodinitroethylene (DADNE). With the use of DFT methods, whose accuracy has been calibrated by means of ab initio calculations (MP2, MP4, G2) on a simpler but related molecule, nitroethylene, we have been able to characterize the entire decomposition reaction pathway. Importantly, we find that the reaction is initiated by a nitro-to-nitrite rearrangement with a calculated energy barrier of magnitude 59.1 kcal/mol obtained by use of B3LYP (59.7 kcal/mol B3P86) which is very close to the experimental activation energy of 58 kcal/mol. We have been able to characterize every step in the decomposition reaction path leading to fragments NO, HONO, CO, NH2, and HNC. These may interact to yield final stable products, CO, N-2, H2O with an energy release that on average is adequate to initiate two additional DADNE molecular decompositions, and thus, sustain a chain reaction. The structural parameters we have calculated for DADNE are consistent with the known experimental crystallographic structure, and also with previous theoretical calculations. Additionally, we have obtained the structural parameters of the initial transition state, as well as each subsequent step along the decomposition pathway. Thus we consider the unimolecular decomposition of DADNE to be well characterized.