Lowenstein is remembered for his studies involving motion, size and functionality of the eye's pupil from a neuropsychiatric standpoint. In Germany and America, he created laboratories with specialized equipment dedicated to research of the eye's pupil. He was particularly interested in the status of an individuals' pupil during specific emotional and psychological states, as well as the condition of the pupil during periods of fatigue and alertness.
In 1957, with Irene Loewenfeld, he built an "electronic pupillograph" that incorporated infrared technology. This device was used to accurately measure and analyze the pupils' diameter, and was a forerunner to more sophisticated pupillographic instruments that were developed in later years. Lowenstein and Loewenfeld's pioneer experiments and numerous publications on pupillary topics were a major factor in bringing pupillography into American neuro-ophthalmological medicine.
Recently a psychiatric clinic for children called Das Professor Otto Löwenstein Haus was founded at the University of Bonn in Lowenstein's honor.