The hairpin ribozyme is a prominent member of small ribozymes since it does not require metal ions to achieve catalysis. Guanine 8 (G8) and adenine 38 (A38) have been identified as key participants in self-cleavage and -ligation. We have carried out hybrid quantum-mechanical/molecular mechanical (QM/MM) calculations to evaluate the energy along several putative reaction pathways. The error of our DFT description of the QM region was tested and shown to be ~1 kcal/mol. We find that self-cleavage of the hairpin ribozyme may follow several competing microscopic reaction mechanisms, all with calculated activation barriers in good agreement with those from experiment (20-21 kcal/mol). The initial nucleophilic attack of the A-1(2'-OH) group on the scissile phosphate is predicted to be rate-limiting in all these mechanisms. An unprotonated G8(-) (together with A38H(+)) yields a feasible activation barrier (20.4 kcal/mol). Proton transfer to a nonbridging phosphate oxygen also leads to feasible reaction pathways. Finally, our calculations consider thio-substitutions of one or both nonbridging oxygens of the scissile phosphate and predict that they have only a negligible effect on the reaction barrier, as observed experimentally.