Ab initio calculations which include the effect of electron correlation have been used to study the decomposition reaction of formyl chloride (HClCO) in the presence and absence of AlCl3. The results predict a large decrease in activation energy in the presence of AlCl3. The barrier for the uncatalyzed decomposition of HClCO to HCl and CO is estimated to be 40 kcal/mol. In the presence of AlCl3, the predicted barrier is 4 kcal/mol. The large decrease owes its origin to the elongated C-Cl bond in the AlCl3-ClHCO precursor complex which is predicted to have a binding energy of 9 kcal/mol and to the different decomposition mechanism facilitated by the presence of the Lewis acid. The mechanism involves Cl atom exchange between the AlCl3 catalyst and the HClCO. The transition state for the catalyzed reaction involves the formation of a five-membered ring in which a nonbonded H- -Cl interaction guides the reaction. This structure differs dramatically from the highly distorted transition-state structure found for unimolecular HClCO decomposition.