Here we study the effects of many-body interactions on rate and mechanism in protein folding by using the results of molecular dynamics simulations on numerous coarse-grained Calpha-model single-domain proteins. After adding three-body interactions explicitly as a perturbation to a Gō-like Hamiltonian with native pairwise interactions only, we have found (i) a significantly increased correlation with experimental phi values and folding rates, (ii) a stronger correlation of folding rate with contact order, matching the experimental range in rates when the fraction of three-body energy in the native state is approximately 20%, and (iii) a considerably larger amount of three-body energy present in chymotripsin inhibitor than in the other proteins studied.