This article attempts to identify the links between the chemistry of oxidative desulfurization and cavitation physics for an ultrasound-assisted oxidative desulfurization (UAOD) process using Fenton-peracetic acid as the oxidant. The model system employed was dibenzothiophene (as a model sulfur compound) and toluene (as a model gasoline/diesel). Experiments were performed to assess the role of each component of the oxidant in the chemistry of the process. H2O2 was found to be the key component of the oxidant that balances between several competing pathways and reactions in overall oxidative desulfurization process. Addition of Fe2+ to peracetic acid has a beneficial effect, whereas excess H2O2 has an adverse effect on the process. This article also highlights the physical and mechanistic features of the UAOD process. Transient cavitation is revealed to play a negative role in the desulfurization process, whereas ultrasound has a positive effect. The former effect is a consequence of the scavenging of HO2 center dot radicals in the aqueous phase by radicals generated by cavitation bubbles, whereas the latter effect is attributed to the generation of a fine emulsion between the oxidant and toluene phases as a result of strong micromixing generated by ultrasound. The results of this study clearly point out that less scavenging and effective interphase transfer of HO2 center dot radicals are more crucial to the utilization of HO2 center dot radicals for desulfurization than mere generation.