Selective alcohol dehydrogenation on heterogeneous catalysts is a key industrial reaction for production of aldehydes, ketones, and carboxylic compounds. Design of catalysts with improved activity and selectivity requires understanding of the reaction mechanism and kinetics. Herein, experiments, density functional theory (DFT) and kinetic modelling were combined to elucidate the mechanism and kinetics of ethanol oxidative dehydrogenation to acetaldehyde on gold catalysts. Catalytic experiments clearly emphasized the role of oxygen in this reaction. Ethanol conversion was rather independent on the gold cluster size. Formation of minor products, acetic acid and ethyl acetate was structure sensitive as on smaller clusters ethanol is less prone to oxidation reacting more efficiently with acetic acid to ethyl acetate. DFT calculations indicated that the activation of molecular oxygen is facilitated by the hydrogen bond donor e.g., ethanol, leading to hydrogen abstraction from the bond donor and formation of an OOH intermediate followed by its facile dissociation. Furthermore, the calculations show that ethanol oxidation along such pathway is thermodynamically feasible on smooth Au(1 1 1) facets. The kinetic model developed based on the concept of ethanol mediated activation of oxygen derived from DFT studies, qualitatively and quantitatively by data fitting reproduces experimental observations on ethanol oxidative dehydrogenation over gold on alumina catalyst. The concentration profiles in the catalyst particle were calculated numerically to evaluate the role of diffusion in the catalyst pores. Combining experiments and DFT with kinetic modelling provides a powerful way to unravel the mechanisms and kinetics of heterogeneous catalytic reactions.