Complete geometry optimizations were performed with density functional theory (DFT) in order to study the potential energy surfaces of [CpM(PH 3 )] (M Rh, Ir) complexes inserted into C ± H bonds of propane and cyclopropane. The agreement between DFT and experimental results indicates that the B3LYP/LANL2DZ method can be a powerful tool for the investigation of these oxidative addition reactions. A fragment molecular orbital model suggesting the mechanistic pathway for the oxidative addition of saturated alkanes to [CpML] is described. It is shown that these oxidative addition reactions all proceed in a concerted fashion via a three-center transition state, and all lead to exothermic reactions. In particular, we show that both electronic and steric effects play a major role in the preference for a s CH 2 -type of approach, from which one may predict the formation and stabilities of the regio-and stereoselective insertion products. Our theoretical findings suggest that highly reactive [CpIr(PH 3 )] tends to be nonless discriminating and reacts randomly, while the less reactive [CpRh(PH 3 )] complex is highly selective. We also found that, for both [CpRh(PH 3 )] and [CpIr(PH 3 )], the ease of oxidative addition is in the order: secondary cyclopropane b primary propane b secondary propane. Furthermore, a configuration mixing model based on the work of Pross and Shaik is used to rationalize the computational results. It is demonstrated that both the singlet ± triplet energy gap of 16-electron [CpML] and the s(C ± H) 3s*(C ± H) triplet excitation energy of hydrocarbons play a decisive role in the determination of the reactivity as well as the selectivity of [CpML] insertion.