Free energy simulation methods are used to analyze the effects of the mutation Arg 96----His on the stability of T4 lysozyme. The calculated stability change and the lack of significant structural rearrangement in the folded state due to the mutation are in agreement with experimental studies [Kitamura, S., & Sturtevant, J. M. (1989) Biochemistry 28, 3788-3792; Weaver, L. H., et al. (1989) Biochemistry 28, 3793-3797]. By use of thermodynamic integration, the contributions of specific interactions to the free energy change are evaluated. It is shown that a number of contributions that stabilize the wild type or the mutant partially cancel in the overall free energy difference; some of these involve the unfolded state. Comparison of the results with conclusions based on structural and thermodynamic data leads to new insights into the origin of the stability difference between wild-type and mutant proteins. Of particular interest is the importance of the contributions of more distant residues, solvent water, and the covalent linkage of the mutated amino acid. Also, the analysis of the interactions of Arg/His 96 with the C-terminal end of a helix (residues 82-90) makes it clear that the nearby carbonyl groups (Tyr 88 and Asp 89) make the dominant contribution, that the amide groups do not contribute significantly, and that the helix-dipole model is inappropriate for this case.