beta-Caryophyllene is one of the most widespread sesquiterpenes, found as a main hydrocarbon component in various essential oils, e.g., copaiba oil, which is used for years in folk medicine and occupies an important position in Brazilian pharmaceutical export. The novel selective oxidation of p-caryophyllene by molecular oxygen using the chloride-free Pd(OAc)(2)/p-benzoquinone (BQ) catalytic system has been developed. The reaction gives two main products, both arising from the allylic oxidation of the sterically encumbered endocyclic double bond, whereas the terminal double bond of the substrate remains intact. The catalytic process efficiently operates under 10 atm of oxygen in the absence of auxiliary metal co-catalysts, which are commonly used in related systems. The reaction can also occur under atmospheric pressure ill the presence of Cu(OAc)(2) to accelerate the re-oxidation of p-hydroquinone by molecular oxygen. Both allylic acetates, obtained from beta-car-yophyllene in 75-85% combined yields in both systems, are natural compounds found in essential oils of some plants and have well pronounced perfume properties. To the best of our knowledge, the present work reports the first synthesis of these functionalized sesquiterpenic compounds potentially useful as ingredients of synthetic perfumes and pharmacological compositions.