A molecular level understanding of the aqueous Mg corrosion mechanism will be essential in developing improved alloys for battery electrodes, automobile parts, and biomedical implants. The structure and reactivity of the hydroxylated surface is expected to be key to the overall mechanism because (i) it is predicted to be the metastable surface state (rather than the bare surface) under a range of conditions and (ii) it provides a reasonable model for the outer corrosion film/water interface. We investigate the structure, interactions, and reactivity at the hydroxylated Mg(0001)/water interface using a combination of static Density Functional Theory calculations and second-generation Car–Parrinello ab initio molecular dynamics. We carry out detailed structural analyses into, among other properties, near-surface water orientations, favored adsorption sites, and near-surface hydrogen bonding behavior. Despite the short timescale (tens of ps) of our molecular dynamics run, we observe a cathodic water splitting event; the rapid timescale for this reaction is explained in terms of near-surface water structuring lowering the reaction barrier. Furthermore, we observe oxidation of an Mg surface atom to effectively generate a univalent Mg species (Mg+). Results are discussed in the context of understanding the Mg corrosion mechanism: For example, our results provide an explanation for the catalytic nature of the Mg corrosion film toward water splitting and a feasible mechanism for the generation of the univalent Mg species often proposed as a key intermediate.