ReaxFF based molecular dynamics (MD) simulation provides opportunities for fundamentally understanding pyrolysis of lignocellulose biomass through precisely controlled reaction conditions and monitoring of reaction evolution processes. Despite demonstration of simulating the pyrolysis process of dry lignocellulose, MD investigation of this process assisted by water is yet to be performed. This is important considering that most pyrolysis experiments are performed under wet conditions. In this paper, roles of water on the pyrolysis process of the lignocellulose were investigated by ReaxFF MD simulation. In the simulation, both dry cellulose and lignin systems as well as their systems containing 33% and 66% water by weight were studied at a temperature range of 1250 K-2000 K at a time scale of 5 ns. Products were characterized by studying their phases, H/C, O/C ratios, and their higher heating values (HHV) that are used to evaluate their value as fuels. Time evolutions of water and other chemical products were investigated to determine the role of water in the reactions and to reveal the reaction mechanism. Compared with dry systems, pyrolysis of the cellulose in presence of water shows several interesting trends, including enhanced breakdown of the cellulose polymer, increased oxygenation of the products, and shift of the final products from char to oil. In contrast, lignin remains largely unaffected by water, and simulation has reproduced experimental results of lignin char formation at elevated temperature in liquefaction. Moreover, it is found that the temperature plays an important role in the reactions. As temperature increases the water’s oxygenating effects in the cellulose is decreased. These theoretical results provide solid evidence for unveiling the reaction mechanism of biomass pyrolysis, offering useful guidance for processing wet biomass to liquid fuels.