A DFT/TDDFT investigation was conducted on a series of cyclometalated iridium(III) complexes with 2,5-diaryl-1,3,4-oxadiazole (oxdⁿ) derivatives to shed light on the effects of the stereoisomeric and steric factors on the photophysical properties. On the basis of the results reported herein, we attempt to explain the experimental observations according to which complexes N,N-trans [Ir(oxd⁰)₂(acac)] (1a) and N,N-trans [Ir(oxd¹)₂(acac)] (2a) [with oxd⁰ = 2,5-diphenyl-1,3,4-oxadiazole, oxd¹ = 2,5-bis(4-fluorophenyl)-1,3,4-oxadiazole and acac = acetylacetonate] show high quantum phosphorescence efficiencies (Φ_PL) of 35 and 44%, while an extremely low Φ_PL (<1%) was observed for a number of oxdⁿ based complexes including N,N-cis [Ir(oxd³)₂(acac)] (4b) [with oxd³ = 2-(4-fluorophenyl)-5-(2,4,6-triisopropylphenyl)-1,3,4-oxadiazole]. While new insights were gained on structural and electronic properties, the unusual photophysical properties recently reported for 4b were found to be not inherent to spin–orbit coupling (SOC) effects, but determined by both the S₁–T₁ splitting energy (ΔE_S1–T1) and the transition dipole moment (μ_S1) upon the S₀ → S₁ transition. Drastically large ΔE_S1–T1 and small μ_S1 for 4b (0.70 eV and 0.23 D, respectively) comparative to those for 2a (0.38 eV and 2.76 D, respectively) and 1a (0.58 eV and 2.44 D, respectively) were found to be tightly linked to the twisting degree of the oxdⁿ ligand and to the trans–cis structural isomerism. On the basis of these parameters, the unusual physical properties of 4b were interpreted with respect to 1a and 2a, and the higher Φ_PL of 2a with respect to that for 1a was explained.