Palladium membranes, which are permselective to hydrogen separation, were used for the hydrogen purification and in membrane reactors for improving conversions by shifting the reaction equilibrium. Palladium/ceramic composite membranes were prepared by electroless plating technique and then etched in titanium chloride (TiCl4) as a post treatment to enhance the membrane's durability. These membranes were used for membrane reactors in water gas shift (WGS) reaction. CO conversions for the membrane reactor were obtained according to experimental parameters and compared to the traditional reactor without a palladium/ceramic membrane. As a result, CO conversion using palladium membrane reactor at an appropriate condition was over 20~25% greater than that without the membrane reactor. The stability in the long-term test of up to 120 h for WGS reaction with the membrane reactor was good without the degredation of CO conversion.