The ability of sub- and supercritical water to solubilize both functionalized aromatic compounds and molecular oxygen was exploited for its use as a solvent to perform oxidative modification of a number of compounds. Alkyl aromatic compounds were oxidized to aldehydes, ketones and acids by molecular oxygen mediated by transition metal catalysts in subcritical water. A number of alkyl aromatics were oxidized directly to their acids, including p-xylene, o-xylene, m-xylene, ethylbenzene, and toluene. Alternatively, conditions were discovered which allowed the oxidation reactions to stop at the aldehyde stage. In addition, several aromatic methylenes could be oxidized to ketones, and anthracene could be oxidized to anthraquinone under the same conditions. The syntheses were performed in 10 mi stainless steel and Hastelloy-C 276 batch reactors between 300 and 355 degrees C with up to five equivalents of O-2. The reactions were found to be very sensitive to the nature of the catalysts, with MnBr2 and CoBr2 providing the cleanest reactions and highest yields. Other metal salts led to severe charring or coupling reactions.