This work reports density functional and composite model chemistry calculations performed on the reactions of toluene with the hydroxyl radical. Both the experimentally observed H-abstraction from the methyl group and possible OH-additions to the phenyl ring were investigated. Reaction enthalpies and barrier heights suggest that H-abstraction is more favorable than OH-addition to the ring. The calculated reaction rates at room temperature and the radical-intermediate product fractions support this view. At first sight, this might seem to disagree with the fact that, under most experimental conditions, cresols are observed in a larger concentration than benzaldehyde. Since the accepted mechanism for benzaldehyde formation involves H-abstraction, a contradiction arises that calls for a more elaborate explanation. In this first exploratory study, we provide evidence that support the preference of H-abstraction over OH-addition and present an alternative mechanism which shows that cresols can be actually produced also through H-abstraction and not only from OH-addition, thus justifying the larger proportion of cresols than benzaldehyde among the products.