Aqueous monoethanolamine (MEA) has been extensively studied as a solvent for CO2 capture, yet the underlying reaction mechanisms are still not fully understood. Combined ab initio and classical molecular dynamics simulations were performed to revisit and identify key elementary reactions and intermediates in 25-30 wt% aqueous MEA with CO2, by explicitly taking into account the structural and dynamic effects. Using static quantum chemical calculations, we also analyzed in more detail the fundamental interactions involved in the MEA-CO2 reaction. We find that both the CO2 capture by MEA and solvent regeneration follow a zwitterion-mediated two-step mechanism; from the zwitterionic intermediate, the relative probability between deprotonation (carbamate formation) and CO2 removal (MEA regeneration) tends to be determined largely by the interaction between the zwitterion and neighboring H2O molecules. In addition, our calculations clearly demonstrate that proton transfer in the MEA-CO2-H2O solution primarily occurs through H-bonded water bridges, and thus the availability and arrangement of H2O molecules also directly impacts the protonation and/or deprotonation of MEA and its derivatives. This improved understanding should contribute to developing more comprehensive kinetic models for use in modeling and optimizing the CO2 capture process. Moreover, this work highlights the importance of a detailed atomic-level description of the solution structure and dynamics in order to better understand molecular mechanisms underlying the reaction of CO2 with aqueous amines.