The adsorption of ethanol and important intermediates onto Ag/Al2O3 catalyst employed in the selective catalytic reduction of NOx by ethanol was simulated by density functional theory. Considering the interaction between Ag metal and Al2O3 support, typical Ag-O-Al entities, i.e., Ag-O-Altetra and Ag-O-Alocta, (tetra = tetrahedral and octa = octahedral refer to the coordination sites of Al), were selected as potential adsorption sites on the surface of the catalyst. Ethanol, and enolic and isocyanate species were preferentially adsorbed and activated by Ag-O-Altetra entities rather than by Ag-O-Alocta entities. The strong Lewis acidity of Altetra in the Ag-O-Altetra entity was very important, enabling the entity to accept an electron via forward donation from either the C-O σ bond in ethanol or the N-C σ bond in the −NCO species. Moreover, the hybridization of the Ag and Al orbitals was critical for electron back donation from the Ag-O-Altetra entity to the C-C π bond in the enolic species or N-C π bond in the −NCO species. The significant activation of the N-C bond in −NCO on the Ag-O-Altetra sites facilitated cleavage of −NCO to form N2. Thus, we can conclude that the acidity of the Al site and the interaction between Ag and Al play key roles in the selective catalytic reduction of NOx by ethanol over Ag/Al2O3.