We investigate the mechanism of NH3 adsorption and initial decomposition on the (2 x 1) reconstructed Si(100) surface using B3LYP density functional theory. The Si(100)-(2 x 1) surface is described using cluster approximation. Ammonia is found to adsorb on the "down" atom of the buckled silicon dimer with no activation barrier. We also find that only half of the surface silicon atoms are active sites for ammonia adsorption. Ammonia adsorption on the Si(100)-(2 x 1) is exothermic with an adsorption energy of 29 kcal/mol. Dissociation of the adsorbed ammonia to form NH2(a) and H(a) proceeds with a low activation energy of 5 kcal/mol below the NH3(g) and bare Si(100)-(2 x 1) energy. Our calculated recombination desorption energy of 51 kcal/mol is found to be in good agreement with the temperature-programmed desorption experimental result of 47 kcal/mol. Additionally, our calculated vibrational spectra of NH2(a) and H(a) agree within 2% of the experimental high-resolution electron energy loss spectra.