The ethanol steam-reforming reaction to produce pure hydrogen has been studied theoretically. A mathematical model has been formulated for a traditional system and a palladium membrane reactor packed with a Co-based catalyst and the simulation results related to the membrane reactor for both co-current and counter-current modes are presented in terms of ethanol conversion and molar fraction versus temperature, pressure, the molar feed flow rate ratio and axial co-ordinate. Although the counter-current mode does not always give an ethanol conversion higher than the one obtained in membrane reactor operated in co-current mode, in the first case it is always possible to extract more hydrogen from the reaction zone. With this theoretical analysis, different values of the operating parameters that allow to have a CO-free hydrogen stream and a complete recovery of the hydrogen from the lumen side of the reactor are investigated. (C) 2008 International Association for Hydrogen Energy. Published by Elsevier Ltd. All rights reserved.