The adsorption and the mechanism of the oxidative dehydrogenation (ODH) of propane over VO2-exchanged MCM-22 are investigated by DFT calculations using the M06-L functional, which takes into account dispersion contributions to the energy. The adsorption energies of propane are in good agreement with those from computationally much more demanding MP2 calculations and with experimental results. In contrast, B3LYP binding energies are too small. The reaction begins with the movement of a methylene hydrogen atom to the oxygen atom of the VO2 group, which leads to an isopropyl radical bound to a HOVO intermediate. This step is rate determining with the apparent activation energy of 30.9 kcal mol−1, a value within the range of experimental results for ODH over other silica supports. In the propene formation step, the hydroxyl group is the more reactive group requiring an apparent activation energy of 27.7 kcal mol−1 compared to that of the oxy group of 40.8 kcal mol−1. To take the effect of the extended framework into account, single-point calculations on 120T structures at the same level of theory are performed. The apparent activation energy is reduced to 28.5 kcal mol−1 by a stabilizing effect caused by the framework. Reoxidation of the catalyst is found to be important for the product release at the end of the reaction.