The adsorption and reaction of methanol on clean and oxygen-precovered Cu(100) has been studied using high-resolution electron energy loss spectroscopy (HREELS). On the clean Cu(100) surface, methanol is molecularly adsorbed and forms an ordered layer at around a monolayer coverage. Preadsorbed oxygen promotes the dissociation of methanol via a two-step process. The first reaction step (CH3OH2 + O-2 --> CH3Oa + OHa) occurs below 120 K. Most importantly, for the first time, a stable OH intermediate is directly observed by HREELS. Furthermore, OH subsequently reacts with excess methanol to form gaseous H2O and additional methoxy at 180 K (the second reaction step CH3OHa + OHa --> CH3Oa + H2Og). We have also studied the reaction between methanol and a preadsorbed OH layer on Cu(100), in order to confirm this reaction process occurring at 180 K. These results show that the activation barrier for the second reaction is higher than that of the first reaction on Cu(100).