The iron-porphyrin complex with four positively charged N,N,N-trimethyl-4- ammoniumphenyl substituents (called WSCAT) is an efficient catalyst for the reduction of CO2 to CO in aqueous solution with excellent selectivity. Density functional calculations have been carried out to explore the reaction mechanism and the origin of selectivity. The porphyrin ligand was found to be redox noninnocent and accept two electrons and one proton, while the ferrous ion keeps its oxidation state as +2 during the reduction. The Fe-II-porphyrin diradical intermediate then performs a nucleophilic attack on CO2, coupled with two electron transfers from the porphyrin ligand to the CO2 moiety. Subsequently, an intramolecular proton transfer takes place from the porphyrin nitrogen to the carboxylate oxygen, affording an Fe-II-COOH intermediate. An alternative pathway to form the critical Fe-II-COOH intermediate, involving the attack on CO2 by an unprotonated two-electron reduced Fe-II-porphyrin diradical species followed by protonation, was found to be possible as well. Finally, proton transfer from the carbonic acid in the aqueous solution to the hydroxyl moiety results in the cleavage of the C-O bond and the production of a CO molecule. The formation of an Fe-II-hydride species, a critical intermediate for the production of H-2 and formic acid, was found to be kinetically much less favorable than the protonation of the porphyrin nitrogen, even though it is thermodynamically more favorable. The prevention of this metal-hydride formation pathway explains why this catalyst is highly selective for the reduction of CO2 in aqueous solution.