Selective conversion of alkylphenols to phenol and olefins is presented as a challenging key step in upgrading raw and fossilized lignocellulose. An exceptional and stable dealkylation performance is achieved by application of an acidic ZSM-5 zeolite, in which co-feeding of water is crucial to maintain catalytic activity. The role of water is attributed to competitive adsorption of water and phenol. The lignin-first pathway towards phenol yields a tenfold improvement of phenol compared to the state-of-the-art single-step lignocellullosic depolymerization techniques.