Co-feeding water is shown to increase the reaction rate in the gas phase, H-BEA catalyzed alkylation of phenol with propylene. Additionally, substitution of isopropanol for propylene produces co-generated water from alcohol dehydration within the zeolite crystal, which is concomitant with enhanced alkylation rates. Catalyst characterization using pyridine infrared spectroscopy and isopropylamine temperature programmed desorption indicates that some Lewis acid sites can be converted to Bronsted acid sites in zeolite beta in the presence of water, causing an overall increase in the number of Bronsted acid sites, resulting in subsequent improvements in reaction rate. The results suggest that biomass derived, aqueous alcohols might be suitable alkylating agents for bio-oil derived phenolic compounds, owing to the positive effects of modest amounts of water on the catalyst activity.