Base stacking and H-bonding properties of thioguanine and thiouracils were studied using an ab initio quantum chemical method with inclusion of electron correlation (second-order Moller-Plesset perturbational method). Hydrogen-bonded base pairs containing thiobases are only slightly less stable (up to 2 kcal/mol) than the unmodified base pairs. The N ... S distances are larger by 0.4-0.7 Angstrom compared to the N ... O distances in the standard base pairs. The thio group enhances polarizability of the monomers and their dipole moments. Thus, in stacked complexes of thiobases, both dispersion attraction and electrostatic interactions are enhanced. Mutual contact of the sulfur atoms and their interaction with second-row elements lead to steric clashes destabilizing the stacking, though, in DNA, such clashes should be eliminated by rather small adjustments of the local DNA conformation. The thio group significantly destabilizes the hydration of the 6-position of thioguanine with respect to guanine. The first hydration shell in the major groove might be significantly altered by thioguanine.