We report in this paper on the ultraviolet-assisted vapor-phase oxidation of methanol at room temperature, with the help of nano-size clusters of titanium dioxide dispersed in an MCM-41 silicate matrix. The surface species formed during the adsorption/oxidation of methanol and the transformation that they undergo as a result of ultraviolet irradiation were monitored using in-situ Fourier transform infrared and thermal desorption spectroscopy techniques. Parallel experiments conducted on TiO2/MCM, bulk titania, and pristine MCM-41 samples helped in identifying the individual role of titanium dioxide and host matrix in these processes. The photo-catalytic oxidation of methanol, at concentrations of 0.1 to 1.1 mol% in air, gave rise to formation of CO2 and H2O as products, for both the TiO2/MCM and bulk TiO2 samples. No such reaction occurred on titania-free MCM. Furthermore, the rate of reaction depended upon the TiO2 content of a sample and also on the concentration of methanol in reaction mixture. Thus, the rate of conversion increased progressively with the increase in TiO2 loading from 5 to 21 wt% in TiO2/MCM samples, particularly for the experiments with high concentration of methanol. For low methanol concentration (0.1 mol%) in air, the effect of titania content in MCM was very small. The specific activity (per g of titania) of a sample, on the other hand, showed an inverse relationship with the loading of titanium dioxide in a sample. Infrared and temperature-programmed desorption results revealed that the mode of CH3OH adsorption and the reactivity of the transient species formed during the oxidation process were independent of the size of dispersed titania particles. Thus, the particles of approximately 2-6 nm size, present in TiO2/MCM, exhibited a chemisorption behavior similar to that of the bulk titania. The results of the present study provide strong evidence that the hydroxyl groups, both on the host matrix and at the titania sites, participate independently in the formation of methoxyl groups and at the same time promote the heterogeneous photo-catalytic oxidation of methanol molecules via formation of transient formate groups. Our results also show that the effect of titania crystallite size in the photo-catalytic properties relate mainly to the larger surface area and hence to the enhanced number of chemisorption sites, rather than to the changes in electronic properties.