The adsorption and dissociation of carbon monoxide on Mo (110) surface is studied with density functional theory. The results at different sites (atop, short bridge, long bridge, and hollow) are presented. The hollow site is found to be the most stable adsorption site for CO. The CO molecule is found to adsorb in end-on configurations (alpha states) at high coverage and inclined configurations (beta states) at low coverage. The dissociation activation energy from beta states is found to be similar to 1 eV lower than from alpha state. The adsorption of dissociation products, C and O, on Mo(110) has also been studied. The most stable adsorption site for C and O is long bridge and hollow site, respectively. The adsorption of C and O at low coverage is, in general, stronger than at high coverage, which is partly responsible for the high reactivity of CO dissociation at low coverage, since the binding energy of CO is not very sensitive to the coverage.