We present a density functional study of the benzannulation reaction of heteroatom-stabilized chromium pentacarbonyl carbene complexes with ethyne, According to our calculations, the benzannulation is, independent of the detailed mechanism, exothermic both for hydroxy- and amino-substituted phenyl- and vinylcarbene compounds, The benzannulation starts with a dissociation of the cis-CO molecule closest to the pi-system within the carbene ligand and a subsequent ethyne coordination, producing highly energetic eta(2)-ethyne-carbene complex intermediates. The following ethyne-carbene coupling, leading to eta(3)-allylidene complex intermediates, explains the observed regioselectivity of the benzannulation. The next step is a CO insertion. In the case of phenylcarbene educts, eta(4)-vinylketene complex intermediates are formed, which react to eta(4)-cyclohexadienone complexes by ring closure, whereas in reactions of vinylcarbene educts, the CO insertion produces eta(4)-cyclohexadienone complexes without any further barrier of activation. eta(4)-vinylketene complexes are the most stable, but only weakly exothermic, intermediates along the naphthol formation and eta(4)-cyclohexadienone complexes are the most stable and strongly exothermic intermediates in the phenol formation. This has remarkable experimental consequences : formation of six-membered rings should rarely be observed for ortho-disubstituted phenylcarbene chromium educts, whereas vinylcarbene compounds should generally produce six-membered rings. All reaction steps except the rate-determining cis-CO dissociation are characterized throughout by a pronounced template character and low-energy barriers, We find that the exchange of a cis-CO with a sigma-electron-donating solvent molecule is significantly less endothermic for metal hydroxycarbene than for aminocarbene. This explains the experimentally observed higher reaction temperature needed for the reaction of aminocarbene compared to hydroxycarbene compounds. Only in the case of tetracarbonyl vinylcarbene complexes is an intramolecular saturation of the vacant ligand site, forming eta(3)-allylidene complexes, an alternative to an intermediate coordination of a solvent molecule.