A study was made of the interactions of flash-illuminated chloroplasts with hydrogen peroxide. We conclude: 1. The oxygen precursor system can be reduced beyond the S0 state to an S-1 state, which can be oxidized to S0 by a single flash. 2. In the dark, a two-electron donation by H2O2 takes place which reduces S2 to S0 and S1 to S-1. 3. At the same time, two-electron oxidations by H2O2 re-form, S2 from S0 and S1 from S-1. 4. The catalase-like activity due to this cyclic oxidation and reduction of the S enzyme is higher with the S2 in equilibrium S0 couple than with the S1 in equilibrium S-1 couple. Another process, however, is responsible for most of the O2 evolution from H2O2 in the light. Our evidence indicates that this process: (1) is independent of the S states and insensitive to Tris washing, (2) turns over rapidly in high concentrations of peroxide, (3) yields 1 O2 per electron passing through system II; (4) dismutates two H2O2 molecules, so that there is no net consumption of 'holes'.