Dipped adcluster model (DAM) is a model for surface reactions involving electron transfer between surface and adsorbates. Adcluster is a combined system of the adsorbate and cluster directly interacting, and it is dipped onto the electron bath of the solid metal. Spin and electron exchange occur between the adcluster and the bulk metal, and the equilibrium is established when the chemical potential of the adcluster, which is partial derivative E(n)/partial derivative n with E(n) being the energy of the adcluster as a function of the number n of electrons transferred into the adcluster, becomes equal with the chemical potential mu of the metal surface. Here, n can be non-integer because we are dealing with a partial system. The shape of the E(n) curve as a function of n, in particular, the upper or lower convex nature, determines whether integral or non-integral number of electrons, respectively is transferred from the bulk metal. This shape is closely related with the spin-coupling of the transferred electrons in the active orbital and therefore with the surface magnetism. A molecular orbital model of the dipped adcluster was summarized and the shape was related with the electron-electron repulsions within the active molecular orbitals. Image force, which is an electrostatic interaction between admolecule and surface, is an important long-range force and is included in the DAM. Using the DAM, the size of the adcluster can be much reduced. Otherwise, in the cluster model, a very large cluster must be used for correctly describing chemisorption and catalytic reactions in which electron transfer is important. For surface reactions, electron correlations are often very important and further the catalytically active states are not necessarily the ground state of the adcluster. Sometimes, we have to describe several different electronic states along the reaction dynamics. The SAC (symmetry-adapted-cluster)/SAC-CI (configuration-interaction) method is a method for calculating effectively the correlated wave functions for ground, excited, ionized, and electron attached states and offers a convenient method for studying surface reactions. The DAM has been applied to palladium-O-2, system and halogen chemisorptions on alkali metal surfaces. In the latter subject, interesting electron transfer processes such as harpooning, surface chemiluminescence and surface electron emission were successfully described by the DAM combined with the SAC/SAC-CI method. The same method was also applied to the O-2 chemisorption, molecular and dissociative, on a silver surface. Using the DAM, we could describe, for the first time, the chemisorption and the molecular and dissociative adsorptions of O-2 on a silver surface. The reaction of O-2 on a silver surface which is important in both science and industry is the partial oxidation of ethylene and propylene. Silver is a good catalyst for the epoxidation of ethylene but a very poor catalyst for the same reaction of propylene. We have clarified the active oxygen species of the reaction and the mechanism of the partial oxidation of ethylene. We have further clarified the reason why the same silver catalyst is poor for the epoxidation of propylene and leads to a complete oxidation. Concluding remarks are given in the final section.