Alkane dehydrogenation catalyzed by the Ir(III) complexes (PCP')IT(H)(2) (1) [PCP' = eta(3)-C6H3(CN2-PH2)(2)-1,3] and CpIr(PH3)(H)(+) (10) [Cp = eta(5)-C5H5] is investigated with density functional theory (DFT). For both systems the theoretical results show that catalytic alkane dehydrogenation to alkene proceeds through (i) alkane oxidative addition, (ii) dihydride reductive elimination, (iii) beta-H transfer from alkyl ligand to metal, and finally (iv) elimination of the olefin. Barriers for steps (i), (ii), and(iv) are critical for the catalytic cycle. The (PCP')Ir(H)(2) system is special because these three barriers are balanced (16, 15, and 22 kcal/mol, respectively), whereas in the CpIr(PH3)(H)(+) system these three barriers are unbalanced (9, 24, and 41 kcal/mol,respectively). Thus, in the catalytic cycle for alkane dehydrogenation by (PCP')Ir(H)(2) the reaction endothermicity is achieved gradually. The higher stability of the formally Ir(V) complexes and the eta(2)-alkene complex, which has some Ir(V)-like character, in the CpIr(PH3)(H)(+) system is responsible for the larger barriers in these critical steps. In the key role played by the ligand systems, PCP'(H) vs Cp(PH3), the former increases the energy-of the metal-ligand fragment's triplet state relative to that of the singlet and thus destabilizes all the Ir(V)-like species.