Bulk chromium tri-iodide (CrI3) has long been known as a layered van der Waals ferromagnet 1 . However, its monolayer form was only recently isolated and confirmed to be a truly two-dimensional (2D) ferromagnet 2 , providing a new platform for investigating light–matter interactions and magneto-optical phenomena in the atomically thin limit. Here, we report spontaneous circularly polarized photoluminescence in monolayer CrI3 under linearly polarized excitation, with helicity determined by the monolayer magnetization direction. In contrast, the bilayer CrI3 photoluminescence exhibits vanishing circular polarization, supporting the recently uncovered anomalous antiferromagnetic interlayer coupling in CrI3 bilayers 2 . Distinct from the Wannier–Mott excitons that dominate the optical response in well-known 2D van der Waals semiconductors 3 , our absorption and layer-dependent photoluminescence measurements reveal the importance of ligand-field and charge-transfer transitions to the optoelectronic response of atomically thin CrI3. We attribute the photoluminescence to a parity-forbidden d–d transition characteristic of Cr3+ complexes, which displays broad linewidth due to strong vibronic coupling and thickness-independent peak energy due to its localized molecular orbital nature. Atomically thin chromium tri-iodide is shown to be a 2D ferromagnetic insulator with an optical response dominated by ligand-field transitions, emitting circularly polarized photoluminescence with a helicity determined by the magnetization direction.