Eschewing the common trend toward use of catalysts composed of Cu, it is reported that PdZn alloys are active for CO2 hydrogenation to oxygenates. It is shown that enhanced CO2 conversion is achievable through the introduction of Bronsted acid sites, which promote dehydration of methanol to dimethyl ether. We report that deposition of PdZn alloy nanoparticles onto the solid acid ZSM-5, via chemical vapor impregnation affords catalysts for the direct hydrogenation of CO2 to DME. This catalyst shows dual functionality; catalyzing both CO2 hydrogenation to methanol and its dehydration to dimethyl in a single catalyst bed, at temperatures of >270 degrees C. A physically mixed bed comprising 5% Pd 15% Zn/TiO2 and H-ZSM-5 shows a comparably high performance, affording a dimethyl ether synthesis rate of 546 mmol kg(cat)(-1) h(-1) at a reaction temperature of 270 degrees C.