DFT schemes based on conventional exchange-correlation (XC) functionals have been employed to determine the dipole moment (mu), polarizability (alpha), and first (beta) and second (gamma) hyperpolarizabilities of push-pull pi-conjugated systems. In addition to the failures already pointed out for alpha and gamma in a recent study on polyacetylene chains [J. Chem. Phys. 1998, 109, 10489; Phys. Rev. Lett. 1999, 83, 694], these functionals are also unsuitable for the evaluation of mu and beta. In the case of beta, in particular, an almost catastrophic behavior with respect to increasing chain length is found. We show that the C functional has a negligible effect on the calculated mu, alpha, beta, and gamma whereas the X-part is responsible for the large property overestimations when the size of the system increases. The overly large mu values are associated with an overestimation of the charge transfer between the donor and the acceptor whereas for alpha, beta, and gamma, incomplete screening of the external electric field is responsible for the large discrepancies with respect to accurate values. Our results show that current XC functionals incorrectly describe the polarization of conjugated systems when the polarization is due to donor/acceptor substitution or an external field or both.