This study investigates the relationship between Kushiro lignite-subbituminous coal matrix swelling and gas permeability during CO2 sequestration. Banded and non-banded coal samples have been used in swelling experiments. Banded coal samples tend to have anisotropic swelling, whereas non-banded samples tend to have isotropic swelling. The ratio of strain perpendicular/parallel to the bedding plane was 1.1 up to 4.2. A continuous measurement of coal swelling and permeability was conducted using core samples of 5 cm in diameter and 10 cm in length under various triaxial stress conditions using a Hassler type core holder. The permeability decreases with increasing confining stress under constant effective stress up to 60% for certain conditions. Because there is increasing adsorption volume with increasing pore pressure, adsorption-induced coal swelling has a direct impact on decreasing permeability. However, under constant confining pressure, reduction of CO2 gas permeability due to coal matrix swelling with increasing pore pressure was not observed because it was compensated by decreasing effective stress. This result shows that the decrease of effective stress has a more complex effect on gas permeability than coal matrix swelling. (C) 2016 Elsevier B.V. All rights reserved.