Abstract Upcycling polyethylene terephthalate (PET) plastic waste on islands into valuable fuels represents a promising strategy for carbon resource utilization and circular economy development; however, this approach faces critical challenges, including low processing concentrations (currently C PET < 1.5 wt%) and fast catalyst deactivation under high‐temperature redox conditions. Herein, we report a site‐decoupled copper catalyst (Cu/MgAlGaZnO x ) that unlocks quantitative conversion of PET to p ‐xylene (PX) at unprecedented concentrations (15.1 wt%), achieving a record PX formation rate of 10.1 −7.8‐fold higher than prior CuNa/SiO 2 systems. In situ spectroscopy reveals that ethylene glycol (EG) fragment oxidation during depolymerization reduces Cu + species in conventional catalysts, triggering rapid deactivation. By contrast, oxygen vacancies (O v ) in the GaZnO x support adsorb methanolysis intermediates, spatially segregating depolymerization (GaZnO x ) from hydrodeoxygenation (Cu/MgAlO x ). This decoupling stabilizes active Cu⁺/Cu 0 ─O v sites, enabling sustained operation at high PET concentrations. Our work establishes site decoupling as a general strategy for stabilizing redox catalysts in polymer upcycling under demanding environments.