The kinetics of oxidation of a hemorheologic drug, pentoxifylline by permanganate in alkaline medium at a constant ionic strength of 0.10 mol dm−3 was studied spectrophotometrically using a rapid kinetic HI-TECH SFA-12 accessory. The reaction between permanganate and pentoxifylline in alkaline medium exhibits 1:2 stoichiometry (pentoxifylline/permanganate). The reaction is of first order in [permanganate ion] and less than unit order dependence each in [PTX] and [OH−]. However, the orders in [PTX] and [OH−] changes from first order to zero order as their concentrations increase. A decrease in the dielectric constant of the medium increases the rate of the reaction. The effect of added products and ionic strength of the reaction medium have been investigated. The oxidation reaction in alkaline medium has been shown to proceed via a permanganate-pentoxifylline complex, which decomposes slowly in a rate-determining step followed by a fast step to give the products. A suitable mechanism is proposed. The main products were identified by TLC and spectral studies including LC−MS. The reaction constants involved in the different steps of the mechanism are calculated. The activation parameters with respect to slow step of the mechanism are computed and discussed and thermodynamic quantities are also determined.