The nature of linear photophysical and nonlinear optical properties of a new squaraine derivative 2,4-bis[4-(azetidyl)-2-hydroxyphenyl]squaraine (1) with efficient near-infrared (NIR) emission was comprehensively analyzed based on spectroscopic, photochemical, and two-photon absorption (2PA) measurements, along with quantum chemical analysis. The steady-state absorption, fluorescence, and excitation anisotropy spectra of 1 and its fluorescence emission lifetimes revealed the multiple aspects of the electronic structure of 1, including the relative orientations of the main transition dipoles, effective rotational volumes in solvents of different polarities, and a maximum molar extinction of 1.35 × 10-5 M-1·cm-1, which is unusually small for similar symmetric squaraines. The degenerate 2PA spectrum of 1 was obtained over a broad spectral range under femtosecond excitation, using standard open-aperture Z-scan and two-photon induced fluorescence methods, revealing maximum 2PA cross sections of ∼400 GM. Squaraine 1 exhibited efficient superluminescence emission in the polar solvent (dichloromethane) at room temperature under femtosecond pumping conditions. Quantum chemical analysis of the electronic structure of 1 was performed using the DFT/TD-DFT level of theory and found to be in good agreement with experimental data. The new squaraine derivative 1 displayed high fluorescence quantum yield, efficient NIR superluminescence, large 2PA cross sections, and high photostability with a photodecomposition quantum yield ∼4 × 10-6, suggesting its potential for applications in two-photon fluorescent bioimaging and lasing.