The Nitrogen-Vacancy or NV-center is a color center in diamonds containing atomic nitrogen [1]; in which the nitrogen and the vacancy are situated on neighboring lattice positions. The defect has C3v symmetry; with the nitrogen and the vacancy lying on the C3-axis. It has been well characterized experimentally: usually it is singly negatively charged; has a paramagnetic ground state (S=1) with spatial symmetry A2; and it has a strong dipole allowed 3A2 to 3E transition at 1.945 eV [2]. Recently the NV-center has been used as a qubit; and quantum NOT and controlled rotation (CROT) gates have been demonstrated [3] as well as optical read-out of the electronic spin state [4]. The NV-center has also been used as a single photon source [5;6]. Creating NV-centers in nanodiamonds could open up the possibility of placing NV-centers in an array as qubits in a quantum computer. In this work we present transition energies calculated from first-principles density functional theory (DFT) of the NV-center incorporated into two hydrogen-terminated nanodiamonds with approximate diameters of 1.2 nm and 1.5 nm [7]. We describe the symmetry and energetics of the low-lying states and compare the optical frequencies obtained to experimental results. We compute the major transition of the negatively charged NV-center to within 25 100 meV accuracy and find that it is energetically favourable for substitutional nitrogens to donate an electron to NV0. The excited state of the major transition and the NV0 state with a neutral donor nitrogen are found to be close in energy.