During catalysis by liver alcohol dehydrogenase (ADH), a water bound to the catalytic zinc is replaced by the oxygen of the substrates. The mechanism might involve a pentacoordinated zinc or a double-displacement reaction with participation by a nearby glutamate residue, as suggested by studies of human ADH3, yeast ADH1, and some other tetrameric ADHs. Zinc coordination and participation of water in the enzyme mechanism were investigated by X-ray crystallography. The apoenzyme and its complex with adenosine 5′-diphosphoribose have an open protein conformation with the catalytic zinc in one position, tetracoordinated by Cys-46, His-67, Cys-174, and a water molecule. The bidentate chelators 2,2′-bipyridine and 1,10-phenanthroline displace the water and form a pentacoordinated zinc. The enzyme-NADH complex has a closed conformation similar to that of ternary complexes with coenzyme and substrate analogues; the coordination of the catalytic zinc is similar to that found in the apoenzyme, except that a minor, alternative position for the catalytic zinc is ∼1.3 Å from the major position and closer to Glu-68, which could form the alternative coordination to the catalytic zinc. Complexes with NADH and N-1-methylhexylformamide or N-benzylformamide (or with NAD and fluoro alcohols) have the classical tetracoordinated zinc, and no water is bound to the zinc or the nicotinamide rings. The major forms of the enzyme in the mechanism have a tetracoordinated zinc, where the carboxylate group of Glu-68 could participate in the exchange of water and substrates on the zinc. Hydride transfer in the Michaelis complexes does not involve a nearby water.