Decomposition of diluted methane (space velocity, 6450 cm(3) g(-1) h(-1)) over Ni/ZrO2 catalyst (for I h) followed by gasification (carried out at the same temperature and period) by steam (50% steam in N-2, with a space velocity of 7740cm(3) g(-1) h(-1)) of the carbon formed on the catalyst at different concentrations of methane (2-75% CH4 in N2) in the feed and temperatures (450-600degreesC) has been thoroughly investigated. Both the methane decomposition and carbon gasification steps are strongly influenced by the concentration of methane in the feed and also by the temperature. In the methane decomposition step, the methane conversion is limited thermodynamically; it is decreased markedly with increasing methane concentration but increased sharply with increasing temperature. In the methane decomposition step, there is little if any rise in the pressure drop across the catalyst for the initial reaction period, which can be considered as an induction period for the pressure drop increase due to the formation of filamentous carbon between the catalyst particles. When the methane concentration or temperature is increased, the induction period is decreased and also the pressure drop is increased at a larger rate. In the carbon gasification step, the degree of carbon gasification is decreased markedly with increasing the methane concentration, but it is increased sharply (approaching close to 100% at 600 degreesC) with increasing the temperature. For one to achieve high methane conversions, particularly using methane without dilution for avoiding separation of the diluent from products, and also high degree of carbon gasification, both the methane decomposition and carbon gasification steps should be carried out at higher temperature (at 600 degreesC or above). However, at the higher temperature, a significant amount of CO is formed in the gasification step. XPS studies of the catalyst revealed that the surface of Ni is covered to a very large extent by the carbon formed in the methane decomposition and that the relative concentrations of the carbon, species (viz. carbidic, semi-carbidic/semi-graphitic, graphitic and carbonate species) formed on the catalyst depends strongly on the methane decomposition temperature. The relative concentration of the carbon species is further changed after the gasification.