The phosphorylation of tyrosine catalyzed by the tyrosine kinase domain of the insulin receptor has been investigated by means of semiempirical (PM3) molecular orbital calculations. A mechanism comprising ATP protonation followed by a proton shift within ATP and subsequent elimination-addition of the metaphosphate anion (PO 3 - ) is proposed. Both the proton shift and elimination steps are endoergonic, with associated enthalpies of 17 and 18kcal/mol, respectively. On the other hand, the addition of PO 3 - to tyrosine is exoergonic, with an associated enthalpy of 15kcal/mol. Furthermore, the possible structural and catalytic roles of the two Mg 2 + ions experimentally located in the active site of the insulin kinase domain have also been critically examined.