ICN photochemical reaction in liquid Ar has been studied theoretically based on molecular dynamics simulation. The interaction potential functions between Ar and ICN in excited states as well as in the ground state were newly developed from ab initio calculation. Three types of reactions have been found for photodissociation starting from the (3) Pi(0+) state, i.e. (i) a substantial fraction of ballistic dissociation to give mostly I*(P-2(1/2)) + CN, (ii) isomerization to INC, an isomer of ICN, and (iii) recombination to ICN. In the last two types of reactions, it has been found that non-adiabatic transition takes place repeatedly in the cage.