Protonated phosphovanadomolybdates of the Keggin structure, H3+xPVxMo12-xO40 where x = 0, 1, 2, and derivatives with surface defects formed by loss of constitutional water were studied using high-level DFT calculations toward determination of the most stable species and possible active forms in oxidation catalysis in both the gas phase and in polar solutions. The calculations demonstrate that protonation at bridging positions is energetically much more favorable than protonation of terminal oxygen atoms. The preferential protonation site is determined by the stability of the metal oxygen bond rather than the negative charge on the oxygen atom. In H3PMo12O40, maximum distances between protons at bridging oxygen atoms are energetically favored. In contrast, for H4PVMo11O40 and H5PV2Mo10O40 protons prefer nucleophilic sites adjacent to vanadium atoms. Up to three protons are bound to the nucleophilic sites around the same vanadium atom in the stable isomeric forms of H5PV2Mo10O40 that result in strong destabilization of oxo-vanadium(V) bonding to the Keggin unit. Such behavior arises from the different nature of the Mo-O and V-O bonds that can be traced to the different sizes of the valence d orbitals of the metals. Coordination of two protons at the same site yields water and an oxygen defect as a result of its dissociation. The energetic cost for the formation of surface defects decreases in the order: O-t >> O-c greater than or similar to O-c and is lower for the sites adjacent to vanadium atoms. Vanadium atoms near defects also have a significant contribution to the LUMO. Thus, vanadium-substituted polyoxometalates with defects near and, especially, between vanadium atoms present a plausible active form of polyoxometalates in oxidation reactions.