In the presence of magnesium ions, cleavage by the hammerhead ribozyme RNA at a specific residue leads to 2'3'-cyclic phosphate and 5'-OH extremities. In the cleavage reaction an activated ribose 2'-hydroxyl group attacks its attached 3'-phosphate. Molecular dynamics simulations of the crystal structure of the hammerhead ribozyme, obtained after flash-freezing of crystals under conditions where the ribozyme is active, provide evidence that a mu-bridging OH-ion is located between two Mg2+ions close to the cleavable phosphate. Constrained simulations show further that a flip from the C3'- endo to the C2'- endo conformation of the ribose at the cleavable phosphate brings the 2'-hydroxyl in proximity to both the attacked phosphorous atom and the mu-bridging OH-ion. Thus, the simulations lead to a detailed new insight into the mechanism of hammerhead ribozyme cleavage where a mu-hydroxo bridged magnesium cluster, located on the deep groove side, provides an OH-ion that is able to activate the 2'-hydroxyl nucleophile after a minor and localized conformational change in the RNA.