The demethanation reaction of dimethyl ether by Fe+ on both quartet and sextet potential energy surfaces have been investigated using density functional theory (B3LYP) in conjunction with the DZVP and 6-311+G(d) basis sets. The calculation results indicate that, along the energetically preferable quartet pathway, the demethanation reaction take places through four elementary steps, that is, encounter complexation, C-O activation, beta-H shift, and nonreactive dissociation, whereas along the sextet PES, both the C-O and methyl C-H activation could result in the demethanation reaction with relative higher energy barriers and intermediates. (C) 2008 Elsevier B.V. All rights reserved.