The desorption and reactions of propylene and propylene oxide adsorbed on atomic oxygen covered and hydroxyl covered Ag(110) were investigated to elucidate the effect of water on the oxidation of propylene over silver catalysts. Previous studies clearly indicate enhancement of propylene partial oxidation by the addition of water to reactor feed streams. Propylene combustion by oxygen adatoms on Ag(110) is completely passivated by water coadsorption on the oxygen atom covered surface (water adsorption on O-Ag(110) results in hydroxyl groups). The desorption activation energy of propylene and propylene oxide is increased by up to 30% by adsorbed oxygen atoms on Ag(110). The desorption activation energy for propylene and propylene oxide is reduced on the hydroxyl covered surface relative to desorption from atomic oxygen covered Ag(110). These results suggest that the inhibition of deep oxidation plays an important role in the previously observed water enhancement. In addition, the decreased desorption activation energies for both propylene, the reactant, and propylene oxide, the desired product, may influence the selectivity of this complex reaction system. Potential changes in catalytic reactivity and selectivity caused by water addition are discussed in terms of a general catalytic reaction rate law.