We describe here our recent studies of carbonylation, oxidation, reforming, and homologation catalysis of dimethyl ether. The selective carbonylation of DME to methyl acetate, a precursor to acetic acid, occurs selectively within constrained channels in zeolites with >99% selectivity and unprecedented transition state selectivity made possible by anhydrous conditions, which prevent the ubiquitous inhibition by the water formed in analogous reactions of methanol. Acid-catalyzed homologation of DME led to the selective formation of branched alkanes with higher selectivities and at lower temperatures than for similar reactions of methanol. Oxidative dehydrogenation, steam reforming, and combustion reactions of DME were found to be more demanding than for methanol, because C-O or C-H cleavage in DME molecules determines reaction rates and these steps are slower than the corresponding O-H and C-H activation steps required for similar reactions of methanol. These kinetic hurdles were overcome either by coupling hydrolysis reactions (that form methanol) with these reactions or by designing more effective catalysts for C-O and C-H activation in DME. These approaches led to catalyst compositions consisting of small metal and oxide cluster with unprecedented reactivity for selective DME oxidation to formaldehyde, for DME reforming to form hydrogen-rich streams of high purity, and for low-temperature catalytic combustion of DME.