Liquefaction of Spirulina, a high-protein microalga, afforded > 90 wt% of THF-soluble products and 60 wt% of hexane-soluble fractions, in the temperature range 300-425 degrees C under hydrogen in various organic solvents with highly dispersed catalysts. The oil yield increased from 52.3 to 66.9 wt% With Fe(CO)(5)-S catalyst at 350 degrees C for 60 min in tetralin under 5.0 MPa of hydrogen. Hydrogen activated by the dispersed catalyst contributed to an increase in oil yield. Liquefaction in water as solvent gave a higher oil yield of 783 wt% at 350 degrees C even under nitrogen. Liquefaction in toluene gave oil fractions of high carbon content and lower oxygen content, with a heating value of 32-33 MJ kg(-1). On the contrary, oil fractions obtained in water had a lower carbon content and higher oxygen content, with a lower heating value of 26 MJ kg(-1). The presence of moderate amount of water is considered to be effective for the production of oil of high heating value in high yield. FT-i.r. spectroscopy and gel permeation chromatograph, showed that production of oil fractions proceeded via thermal decomposition of polypeptides and hydrolysis by water produced during liquefaction in organic solvents.