Searching for functional polyesters with stability and degradability is important due to their potential applications in biomedical supplies, biomass fuel, and environmental protection. Recently, a cyclobutane-fused lactone (CBL) polymer was experimentally found to have superior stability and controllable degradability through hydrolysis reactions after activation by mechanical force. In order to provide a theoretical basis for developing new functional degradable polyesters, in this work, we performed a detailed quantum chemical study of the alkaline and acidic hydrolysis of CBL using dispersion-corrected density functional theory (DFT-D3) and mixed implicit/explicit solvent models. Various possible hydrolysis mechanisms were found: BAC2 and BAL2 in the alkaline condition and AAC2, AAL2, and AAL1 in the acidic condition. Our calculations indicated that CBL favors the BAC2 and AAC2 mechanisms in alkaline and acidic conditions, respectively. In addition, we found that incorporating explicit water solvent molecules is highly necessary because of their strong hydrogen-bonding with reactant/intermediate/product molecules.