Abstract Statistical mechanics and molecular dynamics simulations have been carried out to study the distribution and dynamics of internal water molecules in bovine heart cytochrome c oxidase (CcO). CcO is found to be capable of holding plenty of water, which in subunit I alone amounts to about 165 molecules. The dynamic characterization of these water molecules is carried out. The nascent water molecules produced in the redox reaction at the heme a 3–CuB binuclear site form an intriguing chain structure. The chain begins at the position of Glu242 at the end of the D channel, and has a fork structure, one branch of which leads to the binuclear center, and the other to the propionate d of heme a 3. The branch that leads to the binuclear center has dynamic access both to the site where the formation of water occurs, and to delta-nitrogen of His291. From the binuclear center, the chain continues to run into the K channel. The stability of this hydrogen bond network is examined dynamically. The catalytic site is located at the hydrophobic region, and the nascent water molecules are produced at the top of the energy hill. The energy gradient is utilized as the mechanism of water removal from the protein. The water exit channels are explored using high-temperature dynamics simulations. Two putative channels for water exit from the catalytic site have been identified. One is leading directly toward Mg 2+ site. However, this channel is only open when His291 is dissociated from CuB. If His291 is bound to CuB, the only channel for water exit is the one that originates at E242 and leads toward the middle of the membrane. This is the same channel that is presumably used for oxygen supply.