The stereospecific oxidative decomposition of urate into allantoin is the core of purine catabolism in many organisms. The spontaneous decomposition of upstream intermediates and the nonenzymatic racemization of allantoin lead to an accumulation of (R)-allantoin, because the enzymes converting allantoin into allantoate are specific for the (S) isomer. The enzyme allantoin racemase catalyzes the reversible conversion between the two allantoin enantiomers, thus ensuring the overall efficiency of the catabolic pathway and preventing allantoin accumulation. On the basis of recent crystallographic and biochemical evidence, allantoin racemase has been assigned to the family of cofactor-independent racemases, together with other amino acid racemases. A detailed computational investigation of allantoin racemase has been carried out to complement the available experimental data and to provide atomistic insight into the enzymatic action. Allantoin, the natural substrate of the enzyme, has been investigated at the quantum mechanical level, in order to rationalize its conformational and tautomeric equilibria, playing a key role in protein-ligand recognition and in the following catalytic steps. The reaction mechanism of the enzyme has been elucidated through quantum mechanics/molecular mechanics (QM/MM) calculations. The potential energy surface investigation, carried out at the QM/MM level, revealed a stepwise reaction mechanism. A pair of cysteine residues promotes the stereoinversion of a carbon atom of the ligand without the assistance of cofactors. Electrostatic fingerprint calculations are used to discuss the role of the active site residues in lowering the pK(a) of the substrate. The planar unprotonated intermediate is compared with the enolic allantoin tautomer observed in the active site of the crystallized enzyme. Finally, the enzymatic catalysis featured by allantoin racemase (AllR) is compared with that of other enzymes belonging to the same family.