Equilibrium atomic configurations and electron energy structure of ethanol adsorbed on the Si (111) surface are studied by the first-principles density functional theory. Geometry optimization is performed by the total energy minimization method. Several equilibrium atomic configurations of ethanol, both undissociated and dissociated, on the Si (111) surface are found. Reaction pathways and predicted transition states are discussed in comparison with available experimental data in terms of the feasibility of the reactions occurring. Analysis of atom and orbital resolved projected density of states indicate substantial modifications of the Si surface valence and conduction bands due to the adsorption of ethanol affecting the electrical properties of the surface.