Density functional theory was employed to study the water–gas shift (WGS) reaction for two structural models—namely, a single Au atom and a Au nanorod—supported on the (110) surface of ceria. The carboxyl mechanism involving a COOH intermediate is strongly preferred over the redox mechanism, which would require O–H bond cleavage of ceria-bound hydroxyl groups. Two candidate rate-controlling elementary reaction steps were identified in the carboxyl mechanism: oxygen vacancy formation and COOH formation from CO and OH adsorbed to Au and the ceria support, respectively. A reaction energy analysis shows that both steps are more favorable on clustered Au atoms than on a single Au atom. CO adsorption on a single Au atom is hindered because of its negative charge. Comparison to literature data shows that the WGS reaction is preferred for a gold cluster on the CeO2(110) surface over the CeO2(111) one because of the lower binding energy of OH on the former surface. These results are discussed in the light of a large number of experimental and theoretical studies of the Au/CeO2 catalyzed WGS reaction.