Thebaine synthase 2 (THS2) that can transform (7S)-salutaridinol 7-O-acetate to thebaine catalyzes the final step of thebaine biosynthesis in Papaver somniferum. Here, the crystal structures of THS2 and its complex with thebaine are reported, revealing the interaction network in the substrate-binding pocket. Subsequent docking and QM/MM studies was performed to further explore the catalytic mechanism of THS2. Our results suggest that T105 may abstract the proton of C4-OH from the substrate under the assistance of H89. The resulting C4-O- phenolate anion then attacks the nearby C5, and triggers intramolecular S(N)2' syn displacement with the elimination of O-acetyl group. Moreover, the latter S(N)2' reaction is the rate-determining step of the whole enzymatic reaction with an overall energy barrier of 18.8 kcal/mol. These findings are of pivotal importance to understand the mechanism of action of the-baine biosynthesis, and would guide enzyme engineering to enhance the production of opiate alkaloids via metabolic engineering. (C) 2020 Elsevier Inc. All rights reserved.