The nucleoside hydrolase of Trypanosoma vivax hydrolyzes the N-glycosidic bond of purine nucleosides. Structural and kinetic studies on this enzyme have suggested a catalytic role for a flexible loop in the vicinity of the active sites. Here we present the analysis of the role of this flexible loop via the combination of a proline scan of the loop, loop deletion mutagenesis, steady state and pre-steady state analysis, and x-ray crystallography. Our analysis reveals that this loop has an important role in leaving group activation and product release. The catalytic role involves the entire loop and could only be perturbed by deletion of the entire loop and not by single site mutagenesis. We present evidence that the loop closes over the active site during catalysis, thereby ordering a water channel that is involved in leaving group activation. Once chemistry has taken place, the loop dynamics determine the rate of product release.