We present hybrid density functional theory (DFT) calculations of hydrolysis of dimethyl methylphosphonate (DMMP) by the cyclic tetramer of zirconium hydroxide [Zr-4(OH)(16)]. Various binding configurations of DMMP and its hydrolysis products on the tetramer as well as transition structures connecting them were explored using structure optimizations based on multiple, randomly selected initial structures. We find that DMMP can bind to the tetramer through the phosphoryl O, forming either a strong hydrogen bond to a bridging hydroxyl or a coordinate bond to a coordinatively unsaturated Zr atom. The resulting hydrogen-bonded complexes and Lewis adducts have similar energies. We also find that hydrolysis of a P-O CH3 bond can occur either via an addition elimination mechanism involving a same-site terminal hydroxyl or direct interchange between a terminal hydroxyl and a methoxy group of DMMP. The computed activation and reaction enthalpies show that the addition-elimination is both kinetically and thermodynamically favored over the direct interchange. Our findings support recent observations of the reactivity of amorphous zirconium hydroxide toward phosphonate esters including chemical warfare agents.