Synthetic beidellite, natural montmorillonite, and transition metal containing clays were pillared with aluminum and transformed into bifunctional catalysts. The pillared clays with various degrees of tetrahedral substitution have been evaluated as catalysts for isomerisation-hydrocracking of decane. A comparison has been made between the catalytic properties of pillared clays and ultrastable Y zeolites. For decane isomerisation, Al-pillared beidellites and ultrastable Y zeolites are similar catalysts. The activity of the pillared clays follows the sequence of lattice tetrahedral substitution.