Development and validation of a new reduced dimethyl ether-air (DME) reaction mechanism is presented. The mechanism was developed using a modular approach that has previously been applied to several alkane and alkene fuels, and the present work pioneers the use of the modular methodology, with its underlying H/C1/O base mechanism, on an oxygenated fuel. The development methodology uses a well-characterized H/C1/O base mechanism coupled to a reduced set of fuel and intermediate product submechanisms. The mechanism for DME presented in this work includes 30 species and 69 irreversible reactions. When used in combustion simulation the mechanism accurately reproduced key combustion characteristics and the small size enables use in computationally demanding Large Eddy Simulations (LES) and Direct Numerical Simulations (DNS). It has been developed to accurately predict, among other parameters, laminar burning velocity and ignition delay times, including the negative temperature regime. The evaluation of the mechanism and comparison to experimental data and several detailed and reduced mechanisms covers a wide range of conditions with respect to temperature, pressure and fuel-to-air ratio. There is good agreement with experimental data and the detailed reference mechanisms at all investigated conditions. The mechanism uses fewer reactions than any previously presented DME-air mechanism, without losing in predictability.