A new C5H9NO·SnCl2 coordinated ionic liquid (IL) was prepared by reacting N-methyl-pyrrolidone with anhydrous SnCl2. Desulfurization of dibenzothiophene (DBT) via extraction and oxidation with C5H9NO·SnCl2 IL as extractant, H2O2 and equal mol of CH3COOH as oxidants was investigated. The Nernst partition coefficients k(N) of C5H9NO·SnCl2 IL for the DBT in n-octane was above 5.0, showing its excellent extraction ability. During the oxidative desulfurization process, the optimal molar ratio of H2O2/DBT was six. Sulfur removal of DBT in n-octane was 94.8% in 30 min at 30 °C under the conditions of H2O2/DBT molar ratio of six and V (IL):V (oil)=1:3. Moreover, the sulfur removal increased with increasing temperature because of the high reaction rate constant, low viscosity, and high solubility of dibenzothiophene-sulfone in the IL. The kinetics of oxidative desulfurization of DBT was also investigated, and the apparent activation energy was found to be 32.5 kJ/mol. The IL could be recycled six times without a significant decrease in activity.