The optical properties of metals are mainly determined by their plasmonic excitations, with various intriguing phenomena associated with systems in reduced dimensions. In this paper, we present a systematic study of the plasmonic excitations in ultrathin metal films on dielectric substrates using two different theoretical approaches, and with Mg thin films on Si as prototype systems. The bulk of the results are obtained using the first approach within firstprinciples time-dependent local density approximation. We show that the presence of the substrate substantially modifies the plasmon hybridization of the metal films; in turn, the plasmon excitation in the films strongly enhances the absorption of the substrate. The detailed absorption spectra contain several intriguing features. Above the Mg surface plasmon mode, we observe a broad resonance due to the hybridization between the antisymmetric surface plasmon and multipole surface plasmon. Furthermore, below the Mg surface plasmon Content from this work may be used under the terms of the Creative Commons Attribution 3.0 licence. Any further distribution of this work must maintain attribution to the author(s) and the title of the work, journal citation and DOI. mode, there also exists a broad absorption feature, caused by individual electron-hole pair excitations. In the second approach, we use a semi-classical local optics model to reveal an intrinsic connection between the broad absorption feature and the multipole surface plasmon modes, which result from the singleparticle and collective excitations of the same surface electrons, respectively. Our theoretical predictions on the plasmon dispersions and absorption spectra are also shown to be qualitatively consistent with the latest experimental observations using electron energy loss spectroscopy for Mg thin films grown on Si substrates.Keywords: ultrathin metal film, surface plasmon, multipole surface plasmon, plasmon hybridization, local optics model New J. Phys. 16 (2014) 065014 X Li et al