A novel biphasic approach has been proposed for the tandem synthesis of methacrolein from ethylene via hydroformylation and subsequent aldol reaction with formaldehyde. The two catalysts used, viz. one catalyzing hydroformylation of ethylene to propionaldehyde and the other for the aldol condensation of propionaldehyde with formaldehyde are incompatible with each other. The Rh-complex (hydroformylation catalyst) deactivates the aldolisation catalyst in the initial phase of the reaction, and thus prohibits the aldol condensation reaction. In this paper, a strategy of segregation of these two incompatible catalysts in two separate phases is used, which prevents the deactivation of the aldolisation catalyst, resulting in an active and stable catalyst package for the tandem synthesis of methacrolein with high selectivity (similar to95%). This catalyst package has been recycled for five times without any loss in activity or selectivity. (C) 2003 Elsevier B.V. All rights reserved.