This work has investigated the dynamic behavior of a Cu-ZSM-5 catalyst for NO reduction by ethylene under highly oxidizing conditions, typical of lean-burn engine exhaust, using a fixed-bed laboratory reactor. The role of hydrocarbon and oxygen in the NO reduction process has also been investigated, employing transient experimental techniques such as cyclic operation and temperature-programmed desorption and oxidation experiments. Results have indicated that the chromatographic separation effect among the reactants due to different adsorption affinity plays an important role in determining the catalytic activity of Cu-ZSM-5. Various reaction mechanisms proposed in the literature are discussed along with the role of hydrocarbon and oxygen. Based on our observations we propose a reaction mechanism which involves NO decomposition and hydrocarbon oxidation. We also demonstrate experimentally that the activity of the Cu-ZSM-5 catalyst can be significantly improved for NO reduction by a proper cyclic operation.