The conversion of methanol or synthesis gas is an attractive route for producing ethylene and propylene from coal. Utilizing a chabazite ion exchanged with ammonium and rare earth chlorides, methanol is converted to ethylene, propylene, and propane with carbon yields of 70 to 90% at reaction temperatures of 360 to 450/sup 0/C and pressures from 1 to 18 atmospheres. Carbon disulfide in the feed at concentrations less than 2000 ppm increases the operating time between regenerations from four hours to twenty hours. At carbon disulfide concentrations of 3000 ppm or greater, the catalyst goes through three stages. The first is that of a dehydrogenation catalyst that produces carbon monoxide and hydrogen. The second stage produces ethylene and propylene, and finally, the third stage is a dehydration catalyst that produces dimethyl ether. Water has no detrimental effect on the catalyst, and appears to enhance its activity. Increase in pressure increases the production of propylene and propane at the expense of ethylene. X-ray diffraction studies show the formation of an ultrastable zeolite. No permanent deactivation was observed even though the catalyst was overheated once, and had been deactivated and regenerated for as many as 21 times. Ethylene yields increase as the temperature …