The Hydrocracking of heavy oils has been carried out with highly dispersed catalysts using a 1.5 bpd bench scale test plant with two suspended bed reactors in series [1]. The operation conditions depend on the properties of feedstocks, in most cases, 70-100 kg/cm2 and 440-450-degrees-C were favourable. The features of this process are summarized as follows: 1. High middle distillate production is possible with minimum loss of feed as gas and coke. 2. Low quality heavy oils containing large amounts of metals and asphaltenes, can be processed without plugging. 3. Wide catalyst selection is possible, e.g. spent catalyst from commercial hydrodesulfurization plants, ash catalysts and oil-soluble catalysts can be utilized for this process.