Laccase is a multicopper oxidase that contains four Cu ions, one type 1, one type 2, and a coupled binuclear type 3 Cu pair. The type 2 and type 3 centers form a trinuclear Cu cluster that is the active site for O(2) reduction to H(2)O. To examine the reaction between the type 2/type 3 trinuclear cluster and dioxygen, the type 1 Cu was removed and replaced with Hg(2+), producing the T1Hg derivative. When reduced T1Hg laccase is reacted with dioxygen, a peroxide intermediate (P) is formed. The present study examines the kinetics and mechanism of formation and decay of P in T1HgLc. The formation of P was found to be independent of pH and did not involve a kinetic solvent isotope effect, indicating that no proton is involved in the rate-determining step of formation of P. Alternatively, pH and isotope studies on the decay of P revealed that a proton enhances the rate of decay by 10-fold at low pH. This process shows an inverse k(H)/k(D) kinetic solvent isotope effect and involves protonation of a nearby residue that assists in catalysis, rather than direct protonation of the peroxide. Decay of P also involves a significant oxygen isotope effect (k(16)O(2)/k(18)O(2)) of 1.11 +/- 0.05, indicating that reductive cleavage of the O-O bond is the rate-determining step in the decay of P. The activation energy for this process was found to be approximately 9.0 kcal/mol. The exceptionally slow rate of decay of P is explained by the fact that this process involves a 1e(-) reductive cleavage of the O-O bond and there is a large Franck-Condon barrier associated with this process. Alternatively, the 2e(-) reductive cleavage of the O-O bond has a much larger driving force which minimizes this barrier and accelerates the rate of this reaction by approximately 10(7) in the native enzyme. This large difference in rate for the 2e(-) versus 1e(-) process supports a molecular mechanism for multicopper oxidases in which O(2) is reduced to H(2)O in two 2e(-) steps.