The cyclization and intermolecular propagation steps of the cyclopolymerization mechanism are studied with density functional theory. In addition to standard cyclization and intermolecular propagation reactions of cyclopolymerization, competing reactions that lead to chain transfer and termination are also discussed. The mechanistic study of the cyclopolymerization reaction of two representative monomers, N,N-diallylamine (1) and N,N-dimethyl-N,N-diallylamonium (2), was carried out with B3LYP/6-31G* computations. Monomer 1 has almost the same activation barriers for homopolymerization and cyclization. In monomer 2, cyclization is much more facile than homopolymerization, leading to the higher cyclopolymerization efficiency. In the case of 2, methyl substituents on nitrogen inhibit hydrogen abstraction, whereas in 1, hydrogen abstraction reactions from the neutral monomer yield stabilized products leading to chain transfer. Calculations show that facile competing reactions of monomer 1 lower the polymerization efficiency. Monomer 2 displays a stronger preference for cyclization relative to other processes.