The mechanism of AuCl 3 -catalyzed synthesis of highly substituted furans from 2-(1-alkynyl)-2-alken-1-ones with nucleophiles have been investigated using density functional theory calculations done at the BHandHLYP/6-31G(d, p) (lanl2dz for Au) level of theory. Our calculations suggest that the first step of the cycle is the cyclization of the carbonyl oxygen onto the triple bond to form a new and stable five-membered resonance structure of an oxonium ion and a carbocation intermediate. Furthermore, the six-membered carbocation intermediate proposed by Larock et al. was found and characterized as a transition structure on the potential energy surface. The attack of the carbonyl oxygen to the gold coordinated alkynes results in the formation of a resonance structure intermediate which upon subsequent trapping with alcohols followed by migration of hydrogen atom results in the formation of the final products and regeneration of the catalyst. Our computational results are in consistent with the experimental observations of Larock et al. for the AuCl 3 -catalyzed synthesis of highly substituted furans from 2-(1-alkynyl)-2alken-1-ones with nucleophiles.