Abstract: A comprehensive density functional study was carried out to get an insight into the mechanisms of heterogeneous formation and decomposition of N₂O on the char surface by using a char model with zig-zag configuration. The geometry optimizations of reactants, intermediates, transition states and products were made by using density functional theory at the UB3LYP/6-31G(d) level. On the basis of the reaction pathways analysis, the energies of optimized geometries were calculated and corrected with zero point energy; the relative energies and the change of enthalpy were then worked out. Two different reaction pathways are found for N₂O formation from reactions between gaseous NO and another pre-adsorbed NO on the surface of char, with the energy barriers of 69.3kJ/mol and 200.0kJ/mol, respectively. N₂O may also be released through direct attacking pyridinic nitrogen by NO; the highest energy barrier is 418.0kJ/mol. N₂O can be decomposed to N₂ on the surface of char; the energy barrier is 100.8kJ/mol. Both the heterogeneous formation and decomposition of N₂O are exothermic. Reaction rate constants for rate-determining steps were calculated with transition state theory. The rate of N₂O destruction is slightly lower than that of N₂O formation on the char surface at low temperature; two rates become close at higher temperature. High temperature is favorable for the heterogeneous decomposition of N₂O.