Using density-functional perturbation theory, we have studied lattice dynamics, dielectric and thermodynamic properties, and P - T stability fields of the NaCl- ("B1'') and CsCl- ("B2'') structured phases of MgO. The results compare well with available experiments and resolve the controversy between earlier theoretical studies of the phase diagram of MgO. We predict that at all conditions of the Earth's mantle the B1 structure is stable. Static calculations predict the B1-B2 transition to occur at 490 GPa; zero-point vibrations lower this pressure by 16 GPa. The B2-structured phase is dynamically unstable below 110 GPa, but becomes dynamically stable at higher pressures. On the contrary, the B1 phase does not display soft modes at any of the studied pressures. MgO remains an insulator up to ultrahigh pressures: we predict metallization of the B2-structured phase of MgO at 20.7 TPa. (C) 2003 American Institute of Physics.