Laccase is a multicopper oxidase which contains four coppers, one type 1, one type 2, and a coupled binuclear type 3 pair, the type 2 and type 3 copper centers together forming a trinuclear copper cluster. The type I mercury derivative of laccase (T1Hg Lc) has the type 1 center substituted with a redox-inactive Hg2+ ion and an intact trinuclear copper cluster. Reaction of H2O2 with fully oxidized T1Hg Le produces a peroxide adduct which has now been studied in detail. Peroxide is shown to bind to the trinuclear cluster with low affinity, producing spectral and geometric features similar to the intermediate formed in the reduction of O-2 to H2O which had been shown to have the type 2 copper reduced, the type 3 pair oxidized and antiferromagnetically coupled, and two coppers bridged at a distance of 3.4 Angstrom. The peroxide adduct and the intermediate have similar geometric and electronic features with the type 2 oxidized in the adduct. This center is paramagnetic and has been studied in detail. Peroxide binds to the type 2 center. EPR and ligand field (NiR MCD) coupled with CT (absorption and MCD) data demonstrate that peroxide binds to the type 2 Cu which goes from being 3-coordinate in the resting protein to 4-coordinate in the peroxide adduct. Peroxide also binds to the type 3 site from a comparison of ligand field absorption and CD and the presence of more than one intense O-2(2-) --> Cu(II) band in the CT absorption spectrum. A bridging interaction between coppers at 3.4 Angstrom is seen from the EXAFS data. Possible geometric structures for the peroxide adduct and intermediate are proposed, with the electronic structural difference between the adduct and the intermediate being related to the type 2 copper being reduced in the latter. This study (i) firmly establishes the role of the type 2 in catalysis, (ii) demonstrates a type 2/type 3 bridging mode of binding that promote further 2e(-) reduction of peroxide to water, and (iii) provides further support for a peroxide-level intermediate in the catalytic cycle of the multicopper oxidases which involve two 2e(-) steps in the reduction of O-2 to H2O.