The mechanism of carbonyl substitution in [Fe(Ind)(CO)(2)I] (Ind = C(9)H(7)(-), indenyl) by P(OMe)(3) was investigated by means of DFT calculations. The most favourable path involves a spin crossover of the complex from the ground state singlet to the triplet potential energy surface (S = 1), followed by dissociative loss of CO, and phosphite addition to the coordinatively unsaturated intermediate, [Fe(Ind)(CO)I], with S = 1. In the final step, the system returns to the spin singlet surface, affording the product. This dissociative mechanism is in agreement with the experimental findings. Several pathways occurring exclusively along the singlet surface (S = 0) were explored, namely the expected associative mechanism, which is the most favourable among them, and the "pseudo" associative including the participation of solvent (n-octane). In all cases the corresponding energy barriers were significantly higher than the ones involved in the "spin forbidden" mechanism. The rate enhancement observed comparing the Ind complex with the cyclopentadienyl (Cp = C(5)H(5)(-)) analogue reflects the stability difference between the corresponding S = 0 and S = 1 species in the initial step. The larger number of π orbitals and the lower symmetry of the indenyl ligand, compared with Cp, results in a smaller HOMO-LUMO gap, in a more accessible triplet species, and in a smaller barrier for the spin crossover.