We present a first-principles study of the effects of charging and perpendicular electric fields on hydroxyl groups, both of which mediate the reduction of graphene oxide through the formation of H2O and H2O2. Starting with an investigation of the interaction between the hydroxyl groups and graphene, we determine the equilibrium binding geometry, binding energy, and the diffusion path with a minimum energy barrier and show that those equilibrium properties are strongly affected by external agents. While co-adsorbed H and O form bound OH, co-adsorbed H and OH in close proximity form H2O with almost no energy barrier. When negatively charged or subjected to a perpendicular electric field, the energy barrier between two OH co-adsorbed in close proximity is weakened or totally suppressed, forming an oxygen atom strongly bound at the bridge site, together with a water molecule. The water molecule by itself is very weakly bound to graphene and is prone to desorb from the surface, leading to the reduction of graphene oxide. It is therefore demonstrated that the reduction of graphene oxide is promoted to a large extent by negative charging or an applied perpendicular electric field, through the formation of weakly bound water molecules from hydroxyl groups.