This invention relates to a process for producing ethanol comprises supplying a feed comprising carbon monoxide, hydrogen and dimethyl ether to a reaction zone operated under conditions such that (i) part of the carbon monoxide in the feed reacts with part of the hydrogen in the feed to produce methanol; (ii) part of the carbon monoxide in the feed reacts with at least part of the dimethyl ether in the feed to produce methyl acetate; and (iii) part of the hydrogen in the feed reacts with at least part of the methyl acetate produced in (ii) to produce an effluent comprising methanol and ethanol. At least part of the ethanol is recovered from the effluent and at least part of the methanol is dehydrated to produce dimethyl ether, which is recycled to the reaction zone.