The asymmetric synthesis of tetrahydroisoquinolines (THIQs) has gained importance in recent years due to their significant potential in drug development studies. In this study, the conversion of 1-methyl-3,4-dihydroisoquinoline substrate to a chiral amine, 1-methyl-1,2,3,4-tetrahydroisoquinoline, under the catalysis of the stereoselective imine reductase enzyme from Stackebrandtia nassauensis (SnIR) was investigated in detail to elucidate the mechanism and explain the experimental enantioselectivity. The results were found to be in agreement with the experimental data. To elucidate the reaction mechanism, quantum mechanical calculations were performed by considering a large cluster of the active site of the enzyme. In this regard, possible reaction pathways leading to both R- and S-products with the corresponding intermediates and the transition states for the hydride transfer from the cofactor to the substrate were considered by density functional theory (DFT) calculations, and the factors contributing to the observed stereoselectivity were sought. The calculations supported a stepwise mechanism rather than the concerted protonation and the hydride transfer steps. The stereoselectivity in the hydride transfer was found to be due not only to the stability of the enzyme-subtrate complex but also to the corresponding reaction barriers. The calculations were performed at the wB97XD/6-311+G(2df,2p)//B3LYP/6-31G(d,p) level of theory using the PCM approach.