Functions of the metal ion in the substrate-binding site of diol dehydratase are studied on the basis of quantum mechanical/molecular mechanical (QM/MM) calculations. The metal ion directly coordinates to substrate and is essential for structural retention and substrate binding. The metal ion has been originally assigned to the K(+) ion; however, QM/MM computations indicate that Ca(2+) ion is more reasonable as the metal ion because calculated Ca-O distances better fit to the coordination distances in X-ray crystal structures rather than calculated K-O distances. The activation energy for the OH group migration, which is essential in the conversion of diols to corresponding aldehydes, is sensitive to the identity of the metal ion. For example, the spectator OH group of substrate is fully deprotonated by Glu170 in the transition state for the OH group migration in the Ca-contained QM/MM model, and therefore the barrier height is significantly decreased in the model having Ca(2+) ion. On the other hand, the deprotonation of the spectator OH group cannot effectively be triggered by the K(+) ion. Moreover, in the hydrogen recombination, the most energy-demanding step is more favorable in the Ca-contained model. The proposal that the Ca(2+) ion should be involved in the substrate-binding site is consistent with an observed large deuterium kinetic isotope effect of 10, which indicates that C-H bond activation is involved in the rate-determining step. Asp335 is found to have a strong anticatalytic effect on the OH group migration despite its important role in substrate binding. The synergistic interplay of the O-C bond cleavage by Ca(2+) ion and the deprotonation of the spectator OH group by Glu170 is required to overcome the anticatalytic effect of Asp335.