The liquid-phase hydration and acetoxylation of the monoterpene dihydromyrcene (DHM, 3,7-dimethyl-1,6-octadiene) are efficiently catalyzed by Keggin-type heteropoly acid H 3 PW 1 2 O 4 0 (HPA) at 14-30°C to yield dihydromyrcenol (DHM-OH, 2,6-dimethyl-7-octen-2-ol) and dihydromyrcenyl acetate (DHM-OAc). Homogeneous, biphasic (DHM/AcOH-H 2 O-HPA) and heterogeneous (with HPA/SiO 2 catalyst) reactions have been studied. HPA has a much higher catalytic activity than conventional acid catalysts such as H 2 SO 4 and Amberlyst-15. A synthetically useful biphasic acetoxylation/hydration of DHM has been developed. The method provides a 90% selectivity to the sum of DHM-OH and DHM-OAc at 21% DHM conversion and allows for easy and clean catalyst recycling without loss of activity.