Significant efforts have been dedicated to the direct syngas conversion into ethanol, however, achieving a high ethanol yield remains a formidable task. In this study, we present the direct syngas-to-ethanol conversion over Li-promoted RhOx/MgO catalyst (RhOx/Li2O/MgO). The ethanol space-time yield (EtOH STY) and selectivity reached 12.2 mmol gcat–1 h–1 and 20%, respectively, at a 35% CO conversion over the RhOx/Li2O/MgO catalyst. The RhOx/Li2O/MgO catalyst demonstrated superior performance in terms of both ethanol selectivity and STY compared to Rh/Li2O catalysts on other support materials and Rh/MgO catalysts promoted with other alkali metals. In situ/operando spectroscopic techniques, combined with other characterisations and theoretical calculations, have elucidated the interactions between Li2O and Rh on the MgO surface. These interactions promote the formation of new active sites and weaken CO adsorption on the Rh surface, thereby enhancing ethanol production. This work provides a promising strategy for improving ethanol yield in syngas conversion processes.