Density functional theory (DFT), combined with the artificial force-induced reaction (AFIR) method, is used to establish the mechanism of the aqueous Mukaiyama aldol reactions catalyzed by a chiral Fe(II) complex. On the bases of the calculations, we identified several thermodynamically stable six- or seven-coordinate complexes in the solution, where the high-spin quintet state is the ground state. Among them, the active intermediates for the selectivity-determining outer-sphere carbon-carbon bond formation are proposed. The multicomponent artificial force-induced reaction (MC-AFIR) method found key transition states for the carbon- carbon bond formation, and explained the enantioselectivity and diastereoselectivity. The overall mechanism consists of the coordination of the aldehyde, carbon-carbon bond formation, the rate-determining proton transfer from water to aldehyde, and dissociation of trimethylsilyl group. The calculated full catalytic cycle is consistent with the experiments. This study provides important mechanistic insights for the transition metal catalyzed Mukaiyama aldol reaction in aqueous media.