A novel approach has been developed in order to use Kraft lignin as a renewable resource for the production of chemicals. The concept is based on the use of polyoxometalates as reversible oxidants and on the use of radical scavengers, which prevent lignin fragments from repolymerizing. The oxidation of Kraft lignin, which is a potential source of functionalized phenols, by H3PMo12O40 in water yields a relatively small amount of monomeric species detected by GC-MS. The addition of methanol to the reaction resulted in an increase in the yield of monomeric products by a factor of up to 15. Vanillin and methyl vanillate are the main products obtained, in a maximum yield of 5 wt % based on dry Kraft lignin. Methanol plays a decisive role in the prevention of repolymerization by reducing lignin–lignin condensation reactions. Furthermore, it is proposed that methanol generates small amounts of .CH3 and CH3O. radicals through the acid-catalyzed formation of dimethyl ether which couple with lignin fragments.