Equilibrial composition of eight conformers of gamma-hydroxybutyric acid have been established in the gas phase and in aqueous solution by combining ab initio calculations and Monte Carlo simulations. Ab initio RHF/6-311++G** and MP2/6-311++G** optimized conformers have different relative free energies in the gas phase. On the basis of the MP2 results, there are at least four conformers in the gas-phase mixture. The most stable structure is a cyclic conformer without intramolecular hydrogen bond. The equilibrium composition in the aqueous solution is dominated by structures with extended conformations. The conformational preference is the result of a subtle balance of internal free energy and solvation terms. The extended structure is the favored one in a mixed solvent comprised of methanol and chloroform, as well. Calculations predict 1.9 and 2.3 kcal/mol activation free energy for the formation of a cyclic conformer, prerequisite for lactonization, in aqueous solution and in the methanol/chloroform solvent, respectively.