Ceria-based materials have attracted considerable interest due to their potential applications in the electrocatalytic splitting of water for hydrogen production. In this work, the reaction mechanism of water splitting on gadolinium-doped ceria (GDC) is investigated using DFT + U calculations. We found that H2 evolution preferentially proceeds on the overly hydroxylated surfaces of pure ceria and GDC via the formation of Ce–H and Gd–H intermediates, respectively, which is much more efficient than the H2 evolution over their partially hydroxylated surfaces. Notably, GDC is more easily and strongly reduced through formation of oxygen vacancies and hydroxyls compared to pure ceria. Thus, the facile formation of the overly hydroxylated states by the incorporation of Gd leads to the improved electrocatalytic activity of water splitting on ceria. These results indicate that a dopant that stabilizes the reduced ceria and favors the formation of metal-H moiety is capable of effectively improving the reaction activity of ceria for water splitting.