Oxidative dealkylation is a unique mechanistic pathway found in the alpha-ketoglutarate-Fe(II)-dependent AlkB family of enzymes to remove the alkylation damage to DNA bases and regenerate nucleobases to their native state. The B3LYP density functional combined with a self-consistent reaction field was used to explore the triplet, quintet, and septet spin-state potential energy surfaces of the multistep catalytic mechanism of AlkB. The mechanism was found to consist of four stages. First, binding of dioxygen to iron in the active-site complex occurs concerted with electron transfer, thereby yielding a ferric-superoxido species. Second, competing initiation for the activation of oxygen to generate the high-valent iron-oxygen intermediates (ferryloxo Fe-IV=O and ferric-oxyl Fe-III-O-center dot species) was found to occur on the quintet and septet surfaces. Then, conformational reorientation of the activated iron-oxygen ligand was found to be nearly thermoneutral with a barrier of ca. 50 W mol(-1). The final stage is the oxidative dealkylation of the damaged nucleobase with the rate-controlling step being the abstraction of a hydrogen atom from the damaging methyl group by the ferryloxo ligand. For this step, the calculated barrier of 87.4 kJ mol(-1) is in good agreement with the experimental activation energy of ca. 83 kJ mol(-1) for the enzyme-catalyzed reaction.