Quantum mechanical (QM) and QM/molecular mechanics (MM) studies of the full catalytic cycle of N(2)O reduction by CO in Fe-BEA zeolite, that is, oxidation of BEA-Fe by N(2)O and reduction of BEA-Fe-alphaO by CO, is presented. A large QM cluster, representing half of the channel of the BEA zeolite, is used. The contribution of the MM embedding to the calculated activation energies is found to be negligible. The minimum-energy paths for N(2)O decomposition and reduction with CO are calculated using the nudged elastic band (NEB) method. Calculated and experimental activation energies are in good agreement. The two possible orientations for the gaseous molecules adsorbing on the Fe site that are found lead to different activation energies.