The geometric structures and relative stabilities of small iridium oxide nanoclusters, IrmOn (m = 1-5 and n = 1-2m), have been systematically investigated using density functional theory (DFT) calculations at the B3LYP level. Our results show that the lowest-energy structures of these clusters can be obtained by the sequential oxidation of small "core" iridium clusters. The iridium-monoxide-like clusters have relatively higher stability because of their relatively high binding energy and second difference in energies. On the basis of the optimized lowest-energy structures of neutral and cationic (IrO2)(n) (n = 1-5), DFT has been used to study the hydrolysis reaction of these clusters with water molecules. The calculated results show that the addition of water molecules to the cationic species is much easier than the neutral ones. The overall hydrolysis reaction energies are more exothermic for the cationic clusters than for the neutral clusters. Our calculations indicate that H2O can be more easily split on the cationic iridium oxide clusters than on the neutral clusters.