We report a combined quantum mechanics/molecular mechanics (QM/MM) study on the mechanism of reversible dioxygen binding in the active site of hemocyanin (Hc). The QM region is treated by broken-symmetry density functional theory (DFT) with spin projection corrections. The X-ray structures of deoxygenated (deoxyHc) and oxygenated (oxyHc) hemocyanin are well reproduced by QM/MM geometry optimizations. The computed relative energies strongly depend on the chosen density functional. They are consistent with the available thermodynamic data for oxygen binding in hemocyanin and in synthetic model complexes when the BH&HLYP hybrid functional with 50% Hartree-Fock exchange is used. According to the QM(BH&HLYP)/MM results, the reaction proceeds stepwise with two sequential electron transfer (ET) processes in the triplet state followed by an intersystem crossing to the singlet product. The first ET step leads to a nonbridged superoxo Cu-B(II)-O-2(center dot-) intermediate via a low-barrier transition state. The second ET step is even more facile and yields a side-on oxyHc complex with the characteristic Cu2O2 butterfly core, accompanied by triplet-singlet intersystem crossing. The computed barriers are very small so that the two ET processes are expected to very rapid and nearly simultaneous.