The valence effective Hamiltonian technique (VEH), and modified neglect of differential overlap (MNDO) calculations are used to study the influence of strain induced by side chains on the geometry of polydiacetylene backbones and the resulting polymer band structure, band gap, and ionization potential. Simulations of strain effects on the polymer backbone yield variations in optical properties which are similar to those observed experimentally during thermochromic phase changes in urethane-substituted polydiacetylenes. Our results suggest that these changes in optical properties are related to strain at points of substituent attachment and not to fundamental changes in the backbone geometry such as an acetylenic-to-butatrienic transformation.