The reaction mechanism for the palladium(II)-catalyzed cross-coupling of N-tosyl hydrazone S1 with alkene S2 has been studied with the help of density functional calculations. The acetate present in the catalyst was found to directly participate in the reaction. The tBuO鈥?/sup> group that was added in excess into the reaction system plays an important role in forming the new C鈺怌 double bond. In addition, we clarified how water plays an assisting role to promote the catalytic reaction studied.