Acetyl-coenzyme A (CoA) synthase/carbon monoxide dehydrogenase (ACS/CODH) is a bifunctional enzyme that generates CO from carbon dioxide in the C-cluster of the beta subunit and synthesizes acetyl-CoA from carbon monoxide (CO), CoA, and CH3+ at the active site of the A-cluster in the alpha subunit. On the basis of density functional calculations, we predict that methylation of Nip occurs first, and CO then adds to the NipII-CH3 species to form the intermediate, NipII(CO)(CH3), in which Nip deligates one of its SNid bonds. The CO-insertion/CH3-migration occurs on one metal, the proximal Ni, forming the trigonal planar NipII-acetyl intermediate. The thiolate can bind to NipII and reductively eliminate the thioester. Our calculations disfavor the unprecedented bimetallic CO-insertion/CH3-migration. Ni in the proximal site produces a better catalyst than does Cu.