We report in this paper on the H-2-reduction and catalytic behavior of uranyl groups and nano-size crystallites of uranium oxide, co-encapsulated in the pore system of MCM-41 host matrix by employing the two alternative methods of incipient wet impregnation and the exchange of template cations. Based on the results of activity measurements, in situ IR spectroscopy and thermal programmed reduction/desorption studies we conclude that both the uranyl groups and the highly dispersed crystallites of uranium oxide in UOx/MCM samples may independently contribute to the catalytic oxidation of organic molecules, such as methanol, the uranyl groups playing a more important role at lower reaction temperatures. We also observed that the lattice oxygen and the size of uranium oxide crystallites play a vital role, not only in the lowering of reaction onset temperature but also in deciding the nature and the reactivity of transient surface species formed during the decomposition/oxidation of methanol. Furthermore, whereas the larger size U3O8 crystallites helped in the growth of certain oxymethylene (-OCH2) and polymerized oxymethylene ((-OCH2)(n)) species, additional formation of formate-type complexes was observed during the adsorption of methanol on smaller size particles. The formation of these distinct transient species accounted for the lowering of reaction temperature and the enhanced conversion of methanol to CO2, CO and methane as a function of the decrease in uranium oxide crystallite size. (C) 2004 Elsevier B.V. All rights reserved.