Car-Parrinello mixed quantum mechanics/classical mechanics (CP-QM/MM) calculations are performed for phenol blue (PB) in chloroform and water solvents along with Car-Parrinello molecular dynamics (CPMD) calculations on PB in the gas phase. The solvent effect on molecular geometry, particularly of bond length alternation (BLA), has been studied. As reported for similar donor-acceptor polyenic systems, a remarkable solvent effect is seen on the BLA. The calculated BLA parameter suggests that PB is in the neutral form in the gas phase and in chloroform solvent, while in water, it is cyanine-like, which is a Mixture of neutral and zwitterionic resonant forms, something that clarifies the controversial reports on the structure of PB in chloroform. We have also verified that the structures obtained from CPMD and CP-QM/MM calculations are correct by calculating absorption spectra for PB in the gas phase and in chloroform solvent and compared with experimental results. To understand the structure for PB in the gas phase and in water solvent, we have carried out Mayer bond order analysis, supporting that the structure of PB in water is cyanine-like. Moreover. PB in water is found to be much more polarized than that in chloroform solvent. Overall, the present work demonstrates that CP-QM/MM calculations can be used to understand the solvent effects on polyenic and merocyanine-like systems, which are usually difficult to model.