In order to relate the conformational dynamics of the hammerhead ribozyme to its biological function the cleavage reaction catalyzed by the hammerhead ribozyme was monitored by time-resolved nuclear magnetic resonance (NMR) spectroscopy. For this purpose, the two nucleosides around the scissile phosphodiester bond were selectively C-13 labelled in multi-step organic syntheses starting from uniformly C-13-labelled glucose. The phosphoamidites were incorporated using phosphoamidite chemistry in the hammerhead substrate strand. In addition, the 2'-OH group on the 5'-side of the hammerhead substrate strand was labelled with a photolabile protecting group. This labelling strategy enabled a detailed characterisation of the nucleotides around the scissile phosphodiester bond in the ground state conformation of the hammerhead ribozyme in the absence and presence of Mg2+ ions as well as of the product state. Photochemical induction of the reaction in situ was further characterized by time-resolved NMR spectroscopy. The detailed structural and dynamic investigations revealed that the conformation of the hammerhead ribozyme is significantly affected by addition of Mg2+ leading to an ensemble of conformations where dynamic transitions between energetically similar conformations occur on the ms-timescale in the presence of Mg2+. The dynamic transitions are localized around the catalytic core. Cleavage from this ensemble cannot be described by mono-exponential kinetics but follows bi-exponential kinetics. A model is described to take into account these experimental data.