Based on the density functional theory (DFT), the adsorption capabilities and electronic properties of Ag–MoS 2 monolayer were discussed to fully discover the gas sensing performance to transformer oil decomposed gases (H 2 , CO, CH 4 , C 2 H 6 , C 2 H 4 and C 2 H 2 ). Specifically, the adsorption structure, adsorption energy, Mulliken charge analysis, deformation charge density, density of state (DOS), frontier molecular orbital analysis and band structure were explored. The analysis results illustrate that the adsorption to CO, C 2 H 4 and C 2 H 2 is strong, which is superior to the adsorption of H 2 , CH 4 and C 2 H 6 . The narrower band gaps and increased electrical conductivity in all adsorption structures indicate that Ag–MoS 2 monolayer is promising for the detection of studied gases. Therefore, the present study proposes an effective gas-sensing material to estimate the working state and insulation level of power transformers.