Real-space grid quantum mechanical/molecular mechanical (QM/MM) simulations have been carried out to investigate the role of the water solvent on the novel ethanol oxidation reaction catalyzed by two water molecules through proton transfer mechanism. We have considered two thermodynamical conditions of solutions for the calculations; ambient (AW) and supercritical water (SCW). The QM/MM simulations have revealed that the solvation energy for the transition state (TS) is larger than that for the reactant state in the SCW, resulting in the reduction of the activation energy by 3.7 kcal/mol. Meanwhile, in the AW, the energy barrier is raised by 7.2 kcal/mol. Radial distribution functions show that hydrogen bondings between the solvent and the water molecules that participate in the reaction seriously collapse when the complex is changed from the reactant to the TS in AW, suggesting that the closely packed hydrogen bond network attached to the reactant disturbs the proton migration to take place. A reaction mechanism by stepwise proton translocations has also been examined and found to be competing with the concerted one. (C) 2003 American Institute of Physics.