The reaction mechanism for the hydroxylation of benzene and monofluorobenzene, catalysed by a ferryl-oxo porphyrin cation radical complex (compound I), is described by electronic structure calculations in local spin density approximation. The active site of the enzyme is modelled as a six-coordinated (Por +)Fe(IV)O a 2u complex with imidazole or H 3CS- as the axial ligand. The substrates under study are benzene and fluorobenzene, with the site of attack in para, meta and ortho position with respect to F. Two reaction pathways are investigated, with direct oxygen attack leading to a tetrahedral intermediate and arene oxide formation as a primary reaction step. The calculations show that the arene oxide pathway is distinctly less probable, that hydroxylation by an H 3CS-coordinated complex is energetically favoured compared with imidazole, and that the para position with respect to F is the preferred site for hydroxylation. A partial electron transfer from the substrate to the porphyrin during the reaction is obtained in all cases. The resulting charge distribution and spin density of the substrates reveal the transition state as a combination of a cation and a radical ω-adduct intermediate with slightly more radical character in the case of H 3CS- as axial ligand. A detailed analysis of the orbital interactions along the reaction pathway yields basically different mechanisms for the modes of substrate-porphyrin electron transfer and rupture of the Fe-O bond. In the imidazole-coordinated complex an antibonding π*(Fe-O) orbital is populated populated, whereas in the H 3CS-coordinated system a shift of electron density occurs from the Fe-O bond region into the Fe-S bond.