α-Methyl-γ-butyrolactone (III) has been prepared directly from γ-butyrolactone (I) in 89 % yield by selective monomethylation conditions: K₂CO₃/DMC/210°C/7 h. The reaction mechanism was elucidated and described. An intermediate and two byproducts: methyl tetrahydro-3-methyl-2-oxofuran-3-carboxylate (II), 3-(methoxycarbonyl)propyl methyl carbonate (IV) and 3-(methoxycarbonyl)butyl methyl carbonate (V) were identified. The high temperature disproportionation of K₂CO₃ in the presence of dimethyl carbonate to MeOK was observed. The new selective synthesis of 2-methyl-1-tetralone (VI) from α-methyl-γ-butyrolactone (III) by Friedel-Crafts conditions was performed in 79 % yield.