We synthesized terephthalic acid (TPA) from p-xylene at an initial concentration above its solubility limit in high-temperature liquid water (HTW). The nominal p-xylene loading at the reaction conditions was 0.4 mol L-1, which is the highest reported to date for generation of high TPA yields (>70 mol %) in HTW. The presence of two liquid phases during the reaction did not appear to accelerate the rate, unlike behavior reported for some other organic reactions done "on water" at lower temperatures. Adding oxygen gas in a large increment during synthesis produced a black liquid and a black solid byproduct, which is a previously undocumented problem. Adding oxygen in smaller increments prevented formation of the liquid and solid byproducts and also provided high selectivities (90 mol %) and yields (>70 mol %) of TPA. These results demonstrate the feasibility of HTW as a medium for TPA synthesis at p-xylene concentrations even higher than its solubility limit. (C) 2009 American Institute of Chemical Engineers AIChE J, 55: 1530-1537, 2009