Understanding the reaction mechanism of methanol-to-olefin (MTO) conversion is a challenging issue in zeolite catalysis. Using the BEEF-vdW functional with van der Waals (vdW) correction, we systematically investigated the methylbenzene (MB)-based side chain hydrocarbon pool (HP) mechanism in a HSAPO-34 zeotype catalyst. The inclusion of vdW correction is very important, especially in stabilizing the intermediates and transition states with delocalized ion pair structures. The rate-determining step is identified as the propagation of side alkyl chains via the methylation of exocyclic double bonds. No obvious difference was observed in catalytic activity between different hydrocarbon pool species (hexamethylbenzene, tetramethylbenzene, and p-xylene). Ethene appears to be more favorable than propene as the product. These theoretical results strongly support the dual cycle mechanism in which MB-based and olefin-based routes run simultaneously during the MTO conversion, and ethene is produced through the MB-based route.