The mm-sized capsule catalyst Co/SiO2-Z with the H-type zeolite (HZSM-5) as the shell, and the Co/SiO2-Z-Sp-Pd capsule catalyst with Pd loaded by sputtering method, as well as the Co/SiO2-Z-IW-Pd capsule catalyst, loading the Pd by incipient wetness impregnation, were prepared and used for isoparaffin direct synthesis by Fischer-Tropsch synthesis reaction from syngas with H-2/CO ratio of 2/1 at 1.0 MPa and 533 K. The analysis results of XRD, SEM, EDS and NH3-TPD showed that a compact HZSM-5 shell was formed on the Co/SiO2 pellet, and the metallic Pd was well sputtered on the surface of the HZSM-5 shell for the Co/SiO2-Z-Sp-Pd catalyst. The isoparaffin and olefin selectivity increased in the FTS reactions on the HZSM-5 capsule catalyst than on the Co/SiO2 catalyst. The selectivity of isoparaffins increased, and the selectivity of olefins decreased when using the Co/SiO2-Z-Sp-Pd catalyst, compared with the Co/SiO2-Z catalyst or the Co/SiO2-Z-IW-Pd catalyst, because metallic Pd introduced by sputtering on the zeolite shell could hydrogenate olefins efficiently. It was suitable to use the sputtering method for the preparation of the zeolite capsule catalyst loaded with metallic Pd, as conventional impregnation method could not reduce Pd cation due to the strong interaction from zeolite surface. The CO conversion, CH4 and CO2 selectivity on the catalyst of Co/SiO2-Z-Sp-Pd increased with temperature increasing from 513 K to 553 K. At elevated temperature, the isoparaffin selectivity also increased while the olefin selectivity was suppressed. (C) 2013 Elsevier B.V. All rights reserved.