Site-directed mutagenesis is a very powerful approach to altering the biological functions of proteins, the structural stability of proteins and the interactions of proteins with other molecules. Several experimental studies in recent years have been directed at estimating the changes in catalytic properties, (rates of binding and catalysis) in site-directed mutants of enzymes compared to the native enzymes. Simulation approaches to the study of complex molecules have also become more powerful, in no small measure owing to the increase in computer power. These simulations have often allowed results of experiments to be rationalized and understood mechanistically. A new approach called the free-energy pertubation method, which uses statistical mechanics and molecular dynamics can often be used for quantitative calculation of free energy differences. We have applied such a technique to calculate the differential free energy of binding and free energy of activation for catalysis of a tripeptide substrate by native subtilisin and a subtilisin mutant (Asn 155----Ala 155). Our studies lead to a calculated difference in free energy of binding which is relatively small, but a calculated change in free energy of catalysis which is substantial. These energies are very close to those determined experimentally (J. A. Wells and D. A. Estell, personal communication), which were not known to us until the simulations were completed. This demonstrates the predictive power and utility of theoretical simulation methods in studies of the effects of site-specific mutagenesis on both enzyme binding and catalysis.