We present a density functional theory (DFT) study on the hydrogen storage capacity of (5,5) arm-chair single walled carbon nanotubes (SWCNTs) functionalized with magnesium hydride (MgH2). Being lightweight and rich in hydrogen, MgH2 adsorbs H-2 molecules in the vicinity of carbon nanotubes. The H-2 molecules are adsorbed dissociatively on SWCNT + MgH2 complex. The H-H distance gets increased by more than ten times of the initial bond length 0.74 angstrom of the H-2 molecule. The hydrogen storage capacity of three configurations namely C1MgH(2), C5MgH(2) and C10MgH(2) is reported. The density of states is computed for all the systems. The average binding energies of C5MgH(2) and C10MgH(2) when H-2 molecule is adsorbed are 1.86 eV/H-2 and 1.96 eV/H-2, which are approximately equal. Thus, increasing the number of MgH2 molecule does not vary the binding energy of H-2 adsorption. The corresponding temperature, in which desorption will take place, is 2285 K and 2457 K for C5MgH(2) and C10MgH(2) systems respectively, which are much above the room temperature. (C) 2010 Professor T. Nejat Veziroglu. Published by Elsevier Ltd. All rights reserved.