Gradient-corrected density functional theory has been used to study the elementary reactions for the copolymerization of ethylene with methyl acrylate catalyzed by Pd-based diimine catalysts, modeled by the generic complex N boolean ANDN-Pd(n-C3H7)(+), with N boolean ANDN = -NHCHCHNH-. The steric effects in the real systems are discussed on the basis of the calculations for the catalyst with NAN = -NArCRCRNAr-, R = CH3, and Ar = C6H3(i-Pr-2) and the previous calculations on ethylene/propylene polymerization. Considerations have been given to the different possible acrylate complexes, as well as the transition states and the products (agostic complexes and the alternative chelates) for two acrylate insertion paths (1,2 and 2,1). The chelate-opening reactions have also been studied. The results revealed a strong electronic preference for the 2, 1-insertion paths, with a barrier that is 4.5 kcal/mol lower than any other studied insertion pathway. In the real systems the 2,1-insertion of acrylate is preferred by 0.5 kcal/mol. The 2.1-insertion barrier calculated for the real system of 12.4 kcal/mol is in very good agreement with the experimental value of 12.1 kcal/mol. The six-member chelate is the most stable insertion product with an energy that is 21 kcal/mol lower than the kinetic insertion product. The reactions of the chelate opening by ethylene that start from the lowest energy complexes have the lowest barrier for the four-member ring (23 kcal/mol) and the highest for the six-member structure (30.4 kcal/mol). The high barrier for the opening of the six-member chelate suggests the possibility of a two-step chelate-opening mechanism. The internal barriers for the chelate-opening reactions starting from the higher energy complexes are lower then the one-step reaction that starts from the preferred complex and comparable to those of the ethylene insertion into the Pd-alkyl bond. While the chelate opening by a subsequent acrylate insertion seems to be facile for the generic catalyst, steric effects in the real catalyst are likely to decrease the acrylate pi -complexation energies and increase the insertion barriers to the extent where such a reaction becomes unfeasible.