Supramolecular host-guest interactions of oxazine-1 dye with β- and γ-cyclodextrins (βCD and γCD, respectively) have been investigated in neutral aqueous solution (pH ∼ 7) at ambient temperature (∼25 °C) following absorption, fluorescence, and circular dichroism measurements. The dye forms inclusion complexes with both CDs, causing significant changes in its photophysical properties. Whereas fluorescence titration data for lower dye concentrations fit well with 1:1 stoichiometric complexes, the time-resolved fluorescence results indicate formation of a small extent of 1:2 (dye-host) complexes as well, especially at higher CD concentrations. The moderate range of the binding constant values for the present systems indicates the weaker hydrophobic interaction as responsible for the inclusion complex formation in these systems. It has also been observed that γCD facilitates dimerization of the dye, prominently indicated at the higher dye concentrations. On the contrary, βCD always assists deaggregation of the dye, even at very high dye concentrations. Time-resolved fluorescence anisotropy results qualitatively support the inclusion complex formation in the present systems. Results from quantum chemical calculations also nicely corroborate with the inferences drawn from photophysical studies. Observed results demonstrate that the size compatibility of the guest and the host cavity mainly determines the host-guest interaction in the present systems, much similar to the substrate-catalyst binding in many biological systems.