FmtA is a novel esterase that shares the penicillin-binding protein (PBP) core structural folding but found to hydrolyze the removal of d-Ala from teichoic acids. Molecular docking, dynamics, and MM-GBSA of FmtA and its variants S127A, K130A, Y211A, D213A, and K130AY211A, in the presence or absence of wall teichoic acid (WTA), suggest that active site residues S127, K130, Y211, D213, N343, and G344 play a role in substrate binding. Quantum mechanics (QM)/molecular mechanics (MM) calculations reveal that during WTA catalysis, K130 deprotonates S127, and the nucleophilic S127 attacks the carbonyl carbon of d-Ala bound to WTA. The tetrahedral intermediate (TI) complex is stabilized by hydrogen bonding to the oxyanion holes. The TI complex displays a high energy gap and collapses to an energetically favorable acyl-enzyme complex.