Conversion of low-carbon olefins to higher alcohols or olefins via the formation of C–C bonds is an increasingly important topic. We herein report an example of converting isobutene and formaldehyde (38 wt % aqueous solution) to 3-methyl-1,3-butanediol (MBD), a precursor for isoprene. The reaction occurs through a Prins condensation–hydrolysis reaction over a praseodymium (Pr)-doped CeO2 catalyst. The best MBD yield (70%) is achieved over the Pr-doped CeO2 catalyst. Catalyst characterizations with high-angle annular dark field transmission electron microscopy (HAADF-TEM), pyridine adsorption infrared (IR) and Raman spectroscopy, and density functional theory (DFT) calculations show that the doped Pr is uniformly and highly dispersed in the CeO2 crystalline phase. In addition, the Pr doping creates more oxygen vacancy sites on CeO2 and thus enhances the Lewis acidity of the catalyst, which is responsible for the catalytic performance of the Pr-CeO2 catalyst.