In situ Raman spectroscopy, X-ray photoelectron spectroscopy (XPS), scanning electron microscopy (SEM) and fixed-bed microreactor experiments and were used to examine the operating mechanism of an electrolytic silver catalyst in the titled reaction. Methanol oxidation studies were performed at atmospheric pressure, temperatures between 448 and 1073 K and CH3OH/O-2 feed stoichiometries of 1.5-4.0. Particular attention was given to the role of surface chemisorbed and bulk-dissolved oxygen species in the catalytic cycle, and the influence of oxygen speciation on catalyst selectivity to formaldehyde. The results indicate that the product distribution of CH3OH oxidation over electrolytic silver catalysts relates intimately to the nature of the oxygen species formed on the catalyst, which is discussed within a framework comprising two distinct surface chemisorbed atomic oxygen species (denoted O-alpha and O-gamma) and a bulk-dissolved species (denoted O-beta). The selectivity to formaldehyde was highly dependent on the surface ratio O-gamma/O-alpha, both of which increased with temperature from 548 to 923 K and CH3OH/O-2 feed ratio from 1.5 to 2.25. An optimum formaldehyde yield of 84.3% was obtained during microreactor testing of the silver catalyst, under conditions close to those employed industrially (temperature = 923 K, molar ratio CH3OH/O-2 = 2.25, GHSV = 1.25 x 10(5) h(-1)). SEM revealed that pronounced thermal and catalytic etching of the silver catalyst occurred during CH3OH oxidation at 923 K. Based on these results, a scheme was developed for the interaction of CH3OH and O-2 with electrolytic silver catalysts under conditions of industrial formaldehyde manufacture. This work clarifies the role of the O-alpha, O-beta and O-gamma species in methanol oxidation on silver surfaces and provides a fundamental basis for future formaldehyde yield optimisation. (C) 2003 Elsevier B.V. All rights reserved.