We present a rigorous formulation based on the Poynting's theorem in dispersive and lossy media to calculate the quality factor, material loss, radiation loss, and radiation pattern of an optical nanobowtie antenna using the finite-difference time-domain method. The quality factor obtained from our theory, 8.73, agrees well with the experimental data. Our results show that the radiation loss and material loss are comparable. The material loss mainly originates from the chromium rather than gold even though the nanobowtie antenna mostly consists of gold. In addition, due to the small gap and plasmonic mode confinement, the effective modal volume is ultrasmall [6.36 × 10-5(λ/neff)3], which significantly breaks the diffraction limit.