Ab initio molecular orbital method has been used to study the molecular environment effects on the thiolate and selenolate oxidation by hydrogen peroxide. The reaction was firstly examined in vacuo at the QCISD(T)/6-311+G(2df,2pd)//MP2/6-311+G(d,p) theory level. It was found for both thiolate and selenolate that a reactant aggregate is formed having a dissociation rate constant comparable to the activation rate constant, about 10-3 s-1 for thiolate and 10-1 s-1 for selenolate. Using the polarizable continuum model (PCM) it was then found that the dissociation barrier energy decreases dramatically in water giving a dissociation rate constant of the order of 109 s-1. In this case, the predicted overall rate constant of thiolate reaction was about 10.2 mol-1 dm3 s-1 in good agreement with the experimental rate constant of cysteine oxidation in aqueous solution. The calculated selenolate reaction rate constant was somewhat higher, about 35.4 mol-1 dm3 s-1. However this value is several orders of magnitude smaller than the experimental value reported for the oxidation of selenocysteine in glutathione peroxidase. It was concluded by considering the effect of the PCM dielectric constant on the reaction rate constant that the high reactivity of the selenocysteine in glutathione peroxidase, as compared with cysteine, could be mainly due to the molecular environment of the selenocysteine residue.