We report first-principle total-energy electronic-structure calculations in the density functional theory performed for carbon nanotubes with a defect consisting of a pair of an adatom and a vacancy. We find that the activation barriers for formation and healing of the defect are similar to 10 and 2 eV, respectively, indicating the possibility of defect healing under moderate conditions. The defect is found to induce two gap states with characteristics that strongly depend on its arrangement. Further, the metal-insulator transition takes place on the (9,0) nanotube owing to the formation of gap states. (C) 2007 Elsevier B.V. All rights reserved.