By employing computationally intensive molecular dynamics simulations using hybrid quantum-mechanical/molecular-mechanical approach, we analyze here the kinetic and thermodynamic stabilities of various active site protonation states of a fully solvated class C beta-lactamase. We report the detailed mechanism of proton transfer between catalytically important active site residues and the associated free energy barriers. In the apoenzyme, significant structural changes are associated with the proton transfer, and the orientations of active site residues are distinctly different for various protonation states. Among several propositions on the protonation state of the apoprotein, we find that the one with Tyr(150) deprotonated and both Lys(67) and Lys(315) residues being protonated is the most stable one, both thermodynamically and kinetically. However, the equilibrium structure at room temperature is a dynamic one, with Lys(315)H(zeta) delocalized between Tyr(150)O(eta) and Lys(315)N(zeta). Of great importance, the kinetic and thermodynamic stability of protonation states are significantly affected on noncovalently complexing with cephalothin, an antibiotic molecule. The equilibrium structure of the enzyme-substrate (precovalent) complex has a dynamic protonation state where a proton shuttles frequently between the Tyr(150)O(eta) and Lys(67)N(zeta). We examine here the genesis of the manifold change in stability at the molecular level. The importance of our observations toward understanding the reactivity of the enzyme is discussed and experimental observations are rationalized.