  Results of first principles augmented spherical wave electronic structure
calculations for niobium dioxide are presented. Both metallic rutile and
insulating low-temperature NbO2, which crystallizes in a distorted rutile
structure, are correctly described within density functional theory and the
local density approximation. Metallic conductivity is carried to equal amounts
by metal t_{2g} orbitals, which fall into the one-dimensional d_parallel band
and the isotropically dispersing e_{g}^{pi} bands. Hybridization of both types
of bands is almost negligible outside narrow rods along the line X--R. In the
low-temperature phase splitting of the d_parallel band due to metal-metal
dimerization as well as upshift of the e_{g}^{pi} bands due to increased p-d
overlap remove the Fermi surface and open an optical band gap of about 0.1 eV.
The metal-insulator transition arises as a Peierls instability of the
d_parallel band in an embedding background of e_{g}^{pi} electrons. This basic
mechanism should also apply to VO2, where, however, electronic correlations are
expected to play a greater role due to stronger localization of the 3d
electrons.
