Although the reactive sticking probability of oxygen at Ag(111) is of the order of 10(-6) at 295 K, ammonia oxidation is a facile process at low temperatures. A combination of quantitative analysis of photoelectron spectra together with high resolution electron energy loss spectroscopy provides kinetic and spectroscopic evidence for an ammonia-dioxygen complex, stable at 100 K, as the key intermediate. The reactive oxygen O(2)(s) is a transient dioxygen precursor of the unreactive peroxo state O(2)(δ-)(a). It is present as a complex when ammonia and dioxygen are coadsorbed at low temperature (100 K) with evidence from both O(1s) and energy loss spectra. Hydroxyl and amide/imide species are formed, followed by dehydroxylation and "oxide" formation at 260 K. This is a further example (zinc was the first) of how an sp-metal, where dioxygen bond cleavage is slow, provides an alternative pathway via a transient dioxygen state to catalytic oxidation through precursor assisted dioxygen bond cleavage. Whether it is a general characteristic of sp-metals remains to be established. Comparisons are made with the homogeneously catalyzed Gif reaction, the selective oxidation of hydrocarbons by dioxygen.