Indoor formaldehyde (HCHO) pollution has become one of the major issues affecting human health. Catalytic formaldehyde oxidation technology employing oxygen as oxidant has received extensive attention owing to its mild conditions and nontoxic byproducts, but developing affordable and effective catalysts remains a significant hurdle. In this work, α-Ni(OH)₂ was prepared through one-step hydrothermal method and its catalytic formaldehyde oxidation mechanism was investigated. The greatest catalytic formaldehyde elimination rate of 71.2% was demonstrated by α-Ni(OH)₂ at room temperature, which was made with water as the solvent and nickel nitrate as the nickel source. In situ DRIFTS and theoretical calculations revealed that, due to abundant hydroxyl functional groups on the surface of α-Ni(OH)₂, there was strong interaction between adsorbed formaldehyde and hydroxyl group on the surface of α-Ni(OH)₂, which promoted formaldehyde activation and achieved oxidation of formaldehyde without oxygen. On the other hand, the XPS spectra of α-Ni(OH)₂ treated under different conditions confirmed that the active sites of catalytic formaldehyde oxidation were Ni³⁺, and oxygen accelerated the recovery of Ni³⁺ active sites. The surface hydroxyl group of α-Ni(OH)₂ cooperated with the Ni³⁺ active sites achieved excellent catalytic efficiency of formaldehyde oxidation, which was obviously different from the traditional formaldehyde oxidation path with oxygen dissociation as the speed control step. Our work presents a new formaldehyde oxidation pathway controlled by synergy of surface hydroxyl and active sites, and offers a theoretical foundation for the actual use of catalytic formaldehyde oxidation.