Despite many studies, the mechanisms of nonradiative relaxation of uracil in the gas phase and in aqueous solution are still not fully resolved. Here we combine theoretical UV absorption spectroscopy with nonadiabatic dynamics simulations to identify the photophysical mechanisms that can give rise to experimentally observed decay time constants. We first compute and theoretically assign the electronic spectra of uracil using the second-order algebraic-diagrammatic-construction (ADC(2)) method. The obtained electronic states, their energy differences and state-specific solvation effects are the prerequisites for understanding the photodynamics. We then use nonadiabatic trajectory-surface-hopping dynamics simulations to investigate the photoinduced dynamics of uracil and uracil-water clusters. In contrast to previous studies, we found that a single mechanism - the ethylenic twist around the C[double bond, length as m-dash]C bond - is responsible for the ultrafast component of the nonradiative decay, both in the gas phase and in solution. Very good agreement with the experimentally determined ultrashort decay time constants is obtained.