Single crystalline CdTe nanowires have been synthesized using Au-catalyzed chemical vapor deposition. X-ray diffraction reveals the existence of nonnegligible inhomogeneous compressive strain in the nanowires along the 〈111〉 growth direction. The effect of the strain on the electronic structure is manifested by the blue-shifted and broadened photoluminescence spectra involving shallow donor/acceptor states. Such residual strain is of great importance for a better understanding of the optical and electrical behaviors of various semiconductor nanomaterials as well as for device design and applications. © 2014 Tsinghua University Press and Springer-Verlag Berlin Heidelberg.