A mechanism for the oxidation of ammonia by hypochlorous acid to form nitrogen gas has been developed at the B3LYP/6-31G(d,p) level of theory using the Gaussian 03 software package. The formation of NH2Cl, NHCl2, and NCl3 was studied in the gas phase, with explicit water molecules included to examine the transition state energy in aqueous Solution. The inclusion of explicit water molecules in the transition state dramatically reduced the reaction barrier in reactions involving transfer of a hydrogen atom between molecules, effects that were not taken into account through use of a solvation model alone. Three mechanisms were identified for the decomposition of chloramine species to form N-2, involving the combination of two chloramine species to form hydrazine, dichlorohydrazine and tetrachlorohydrazine intermediates. The highest barrier in each pathway was found to be the formation of the hydrazine derivative.