Direct dehydrogenation of methanol to anhydrous formaldehyde was carried out over a novel Ag-SiO2-MgO catalyst prepared by the sol gel method. The catalytic activity was measured over the temperature interval 350 700degreesC and the space velocity of 1 x 10(4) h(-1), while the optimum conditions were found to be 20 wt% loading of silver and 650 8 reaction temperature. The catalyst exhibits excellent activity (96% conversion) and selectivity (78%) during the process of dehydrogenation with the yield of formaldehyde up to 75%. X-ray diffraction patterns for the novel Ag(20 wt%)SiO2MgO catalyst correspond to alpha-crystobalite(100) and Ag(111), (200), (220), (311) and (222). Scanning electron microscopy was used to determine the morphology and particle size. Isolated silver particles with a mean size of about 5 mum were observed on the surface of the catalyst.