Tyrosine ammonia lyase (TAL) catalyzes the deamination of tyrosine to p-coumaric acid in purple phototropic bacteria and Actinomycetales. The enzyme is used in bioengineering and has the potential to be used industrially. It belongs to a family of enzymes that uses a 4-methylidene-imidazole-5-one (MIO) cofactor to catalyze the deamination amino acids. In the present work, we used a QM/MM and a QM cluster models of TAL to explore two putative reaction paths for its catalytic mechanism. Part of the N-MIO mechanism was previously studied by computational methods. We improved on previous studies by using a larger, more complete model of the enzyme, and by describing the complete reaction path. The activation energy for this mechanism, in agreement with the previous study, is 28.5kcal/mol. We also found another reaction path that has overall better kinetics and reaches the products in a single reaction step. The barrier for this Single-Step mechanism is 16.6kcal/mol, which agrees very well with the experimental kcat of 16.0kcal/mol. The geometrical parameters obtained for the cluster and QM/MM models are very similar, despite differences in the relative energies. This means that both approaches are capable of describing the correct catalytic path of TAL.