The basic mechanism of the Payne rearrangement involves deprotonation of the free hydroxyl group, invertive nucleophilic attack on the proximal epoxide carbon, and re-protonation of the newly freed alkoxide. Each step of the process is reversible.
Several observations suggest that this mechanistic picture is oversimplified. Epoxide migration either does not occur or is very sluggish under aprotic conditions—it has been suggested that nucleophilic attack is slowed by the coordination of metal ions to the nucleophilic oxygen under aprotic conditions. In addition, when an external nucleophile is added to equilibrating epoxide isomers, the ratio of opened products does not reflect the ratio of epoxide isomers in solution or their relative thermodynamic stability. In situ nucleophilic opening of equilibrating epoxides is an example of Curtin-Hammett conditions—because the epoxides are equilibrating rapidly relative to the rate of epoxide opening, it is the kinetic barriers of ring opening that control the observed product ratio. In the example below, the product of opening of the terminal epoxide is the major product, even though the terminal epoxide itself is less thermodynamically stable than the internal isomer.
Halo diols may be used as precursors to 2,3-epoxy alcohols prior to rearrangement. Issues of site selectivity may arise if the two hydroxyl groups flanking the halide are not equivalent. In general, the formation of internal, substituted epoxides is more rapid than the formation of terminal epoxides. This idea can be used to predict the course of migrations of in situ-generated epoxides.