The exchange of energy in biochemical reactions involves, in a majority of cases, the hydrolysis of phosphoanhydrides (P-O-P). This discovery has lead to a long discussion about the origin of the high energy of such bonds, and to a proposal that hydration plays a major role in the energetics of the hydrolysis. This idea was supported by recent ab initio quantum mechanical calculations (Saint-Martin et al. (1991) Biochim. Biophys. Acta 1080, 205-214) that predicted the hydrolysis of pyrophosphate is exothermic in the gas phase. This exothermicity can account for only a half of the total energy release that one measures in aqueous solutions. Here we address the problem of hydration of the reactants and products of the pyrophosphate hydrolysis by means of Monte Carlo simulations, employing polarizable potentials whose parameters are fitted to energy surfaces computed at the SCF/6-31G** level of the theory. The present results show that the hydration enthalpies of the reactants and products contribute significantly to the total energy output of the pyrophosphate hydrolysis. The study predicts that both, the orthophosphate and the pyrophosphate, have hydration spheres with the water molecules acting as proton acceptors in the P-OH ... O(water) hydrogen bonds. These water molecules weakly repel the water molecules in the further hydration spheres. The perturbation of the structure of the solvent caused by the presence of the solute molecules is short ranged: after ca. 5 A from the P atoms, the energy and the structure of water correspond to bulk water. Due mainly to nonadditive effects, the molecular structure of the hydrated pyrophosphate is quite different from two fused structures of the hydrated orthophosphates. The hydration sphere of pyrophosphate is very loose and has a limited effect on the water network, whereas for orthophosphate it has a well developed shell structure. Hence, upon hydration there will be both a gain in hydration enthalpy and a gain in entropy because of distortion of the water molecular network.