The optical properties of CdBr2 were studied by first principle using the density functional theory. The dielectric functions and optical constants are calculated using the full potential-linearized augmented plane wave (FP-LAPW) method with the generalized gradient approximation (GGA). The theoretical calculated optical properties and energy Loss (EEL) spectrum yield a static refractive index of 2.1 and a plasmon energy of 13eV for hexagonal phase. The results, in comparison with the published data, are in good agreement with the experimental and previous theoretical results.