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The carcinogenesis of urethane (ethyl carbamate), a byproduct of fermentation that is consistently found in various food products, was investigated with a combination of kinetic experiments and quantum chemical calculations. The main objective of the study was to find ΔG(⧧), the activation free energy for the rate-limiting step of the SN2 reaction among the ultimate carcinogen of urethane, vinyl carbamate epoxide (VCE), and different nucleobases of the DNA. In the experimental part, the second-order reaction rate constants for the formation of the main 7-(2-oxoethyl)guanine adduct in aqueous solutions of deoxyguanosine and in DNA were determined. A series of ab initio, density functional theory (DFT), and semiempirical molecular orbital (MO) calculations was then performed to determine the activation barriers for the reaction between VCE and nucleobases methylguanine, methyladenine, and methylcytosine. Effects of hydration were incorporated with the use of the solvent reaction field method of Tomasi and co-workers and the Langevine dipoles model of Florian and Warshel. The computational results for the main adduct were found to be in good agreement with the experiment, thus presenting strong evidence for the validity of the proposed SN2 mechanism. This allowed us to predict the activation barriers of reactions leading to side products for which kinetic experiments have not yet been performed. Our calculations have shown that the main 7-(2-oxoethyl)deoxyguanosine adduct indeed forms preferentially because the emergence of other adducts either proceeds across a significantly higher activation barrier or the geometry of the reaction requires the Watson-Crick pairs of the DNA to be broken. The computational study also considered the questions of stereoselectivity, the ease of the elimination of the leaving group, and the relative contributions of the two possible reaction paths for the formation of the 1,N(2)-ethenodeoxyguanosine adduct.