Recent advance in highly efficient solar cells based on organic-inorganic hybrid perovskites has triggered intense research efforts to ascertain the fundamental properties of these materials. In this work, we utilize diamond anvil cell to investigate the pressure-induced structural and optical transformations in methylammonium lead iodide (CH3NH3PbI3) at pressures ranging from atmospheric pressure to 7 GPa at room temperature. The synchrotron X-ray diffraction experiment shows that the sample transforms from tetragonal (space group I4cm) to orthorhombic (space group Imm2) phase at 0.3 GPa and amorphizes above 4 GPa. Pressure dependence of the unit cell volume of CH3NH3PbI3 shows that the unit cell volume undergoes a sudden reduction at 0.3 GPa, which can prove the observed phase transition. We provide the high-pressure optical micrographs obtained from a diamond anvil cell. Upon compression, we can visually observe that the opaque black sample gradually transforms into a transparent red one above 4 GPa. We analyze the pressure dependence of the band gap energy based on the optical absorption and photoluminescence (PL) results. As pressure increases up to 0.25 GPa, the absorption edge and PL peak move to the longer wavelength region of 9 nm. However, abrupt blueshifts of the absorption edge and PL peak occur at 0.3 GPa, followed by a gradual blueshift up to 1 GPa, these phenomena correspond to the previously observed phase transitions. Phase transition increases the band gap energy of CH3NH3PbI3 as a result of reductions in symmetry and tilting of the[PbI6]4- octahedral. Upon further compression, the sample exhibits pressure-induced amorphization at about 4 GPa, which significantly affects its optical properties. Further high pressure Raman and infrared spectroscopy experiments illustrate the high pressure behavior of organic CH3NH3+ cations. Owing to the presence of hydrogen bonding between organic cations and the inorganic framework, all of the bending and rocking modes of CH3 and NH3 groups are gradually red-shifted with increasing pressure. The transition of NH stretching mode from blueshift to redshift as a result of the attractive interactions between hydrogen atoms and iodine atoms is gradually strengthened. Moreover, all the observed changes are fully reversible when the pressure is completely released. In situ high pressure studies provide essential information about the intrinsic properties and stabilities of organic-inorganic hybrid perovskites, which significantly affect the performances of perovskite solar cells.