The mechanism of the nitric oxide reduction in a bacterial nitric oxide reductase (NOR) has been investigated in two model systems of the heme- b 3-Fe B active site using density functional theory (B3LYP). A model with an octahedral coordination of the non-heme Fe B consisting of three histidines, one glutamate and one water molecule gave an energetically feasible reaction mechanism. A tetrahedral coordination of the non-heme iron, corresponding to the one of Cu B in cytochrome oxidase, gave several very high barriers which makes this type of coordination unlikely. The first nitric oxide coordinates to heme b 3 and is partly reduced to a more nitroxyl anion character, which activates it toward an attack from the second NO. The product in this reaction step is a hyponitrite dianion coordinating in between the two irons. Cleaving an N O bond in this intermediate forms an Fe B (IV) O and nitrous oxide, and this is the rate determining step in the reaction mechanism. In the model with an octahedral coordination of Fe B the intrinsic barrier of this step is 16.3 kcal/mol, which is in good agreement with the experimental value of 15.9 kcal/mol. However, the total barrier is 21.3 kcal/mol, mainly due to the endergonic reduction of heme b 3 taken from experimental reduction potentials. After nitrous oxide has left the active site the ferrylic Fe B will form a μ-oxo bridge to heme b 3 in a reaction step exergonic by 45.3 kcal/mol. The formation of a quite stable μ-oxo bridge between heme b 3 and Fe B is in agreement with this intermediate being the experimentally observed resting state in oxidized NOR. The formation of a ferrylic non-heme Fe B in the proposed reaction mechanism could be one reason for having an iron as the non-heme metal ion in NOR instead of a Cu as in cytochrome oxidase.