The development of a compact high-density microbial reactor for hydrogen production is described with possible implications to use as a portable bio-fuel cell system. To construct the compact bioreactor, mainly, the cell density and immobilization methods were optimized in this paper. The encapsulation of hydrogen producing bacterium, Escherichia coli strain MC13-4, in alginate gel beads provided approximately three-fold increase in hydrogen production in comparison with the free cell suspension. The immobilized cells (cell density; O.D. 100) and 500 mM glucose solution were packed into a 20 mL glass bottle that was connected to the fuel cell. This system has generated electricity of over 20 mW for 20 min. (c) 2006 International Association for Hydrogen Energy. Published by Elsevier Ltd. All rights reserved.