A transparent microchannel photobioreactor was manufactured to visualize the colony formation of photosynthetic bacteria (PSB), Rhodopseudomonas palustris CQK 01, as well as the biogas bubble behavior within the microstructure. The results showed that the formation of PSB colony in the interior of microchannels can be divided into four stages: bacteria absorption, bacteria reproduction, morphological transformation and colony formation. It was founded that the microchannel vents immobilized by PSB colony was the favorable sites for the emergence of biogas bubbles. In this work, the effects of substrate concentration and flow rate of the influent solution as well as illumination wavelength and intensity on the photo-hydrogen production performance of the bioreactor were also investigated. The microchannel photobioreactor exhibited a maximal hydrogen production rate of 1.48 mmol/g cell dry weight/h, maximal hydrogen yield of 0.91 mol H(2)/mol glucose in all tests at an optimal inlet medium flow rate of 2.8 ml/h and substrate concentration of 50 mmol/l. In addition, photobioreactor showed a highest performance of hydrogen production and substrate consumption at 590 nm illumination wavelength and 5000 lx illumination intensity. Copyright (C) 2011, Hydrogen Energy Publications, LLC. Published by Elsevier Ltd. All rights reserved.