This paper explores the feasibility of controlling the selectivity of a partial oxidation reaction by simultaneous modulation of local oxygen concentration and coolant temperature along the length of a reactor. The microstructured membrane reactor (MMR) concept consists of an oxygen-permeable membrane for distributing the oxygen feed with the coolant channel divided into zones of different temperatures. The reactor concept was explored in simulation of the selective oxidation of o-xylene to phthalic anhydride (PA). A mathematical model of the reactor was developed and optimization performed with the objective of maximising PA selectivity at the reactor outlet. Dosing of oxygen at uniform wall temperature results in PA selectivity increase by 6.3%, albeit with a reduction in o-xylene conversion of about 8% compared to a conventional fixed bed reactor. However, simultaneous modulation of both reactor wall temperatures and local oxygen concentration results in an improved conversion of o-xylene without a detrimental effect on selectivity, thus giving maximum yield of PA.