Dimethyl ether (DME) is a clean and economical alternative fuel which can be produced fromnatural gas through synthesis gas. The properties of DME are very similar to those of LP gas. DME canbe used for various fields as a fuel such as power generation, transportation, home heating and cooking,etc. It contains no sulfur or nitrogen. It is not corrosive to any metal and not harmful to human body. Aninnovative process of direct synthesis of DME from synthesis gas has been developed. Newly developedcatalyst in a slurry phase reactor gave a high conversion and high selectivity of DME production. Oneand half year pilot scale plan (5 tons per day) testing, which was supported by METI, had successfullyfinished with about 400 tons DME production. Dimethyl ether (DME) is a clean and economical alternative fuel which can be produced from natural gas through synthesis gas. The properties of DME are very similar to those of LP gas. DME canbe used for various fields as a fuel such as power generation, transportation It is not corrosive to any metal and not harmful to human body. Aninnovative process of direct synthesis of DME from synthesis gas has been developed. Newly developedcatalyst in a slurry phase reactor gave a high conversion and high selectivity of DME production. One and half year pilot scale plan (5 tons per day) testing, which was supported by METI, had successfully finished with about 400 tons DME production.