Time-dependent density functional theory and high-level ab initio calculations were performed to investigate the excited-state intramolecular proton transfer (ESIPT) and subsequent isomerization of 2-(iminomethyl)phenol (IMP). According to the results of the correlated theoretical methods, ESIPT is a barrierless process; subsequently, the isomerization (rotation of the torsion angle) of IMP also readily occurs. Fictitious intermediates are found due to an insufficient theoretical level. The molecular structure of the conical intersection (CI) during the isomerization process is optimized, and its branching plane is characterized. Both the gradient difference vector and the derivative coupling vector are significantly correlated to the C=O and H2N-C antiparallel stretching coordinates, and the dynamic electron correlation effect is crucial to optimize the molecular structure of the real CI of IMP. The relaxation pathway from the CI in the S-0 state was examined; the dominant pathway proceeds to the trans-keto form of IMP. However, if the C=O and H2N-C antiparallel stretching mode is sufficiently populated, then the reaction proceeds to the cis-keto form of IMP and can eventually recover to the cis-enol form.