The impregnation of NaOH solution into the pores of cobalt-exchanged zeolite promoted the conventional reduction of cobalt ions with hydrogen gas. The method yielded catalysts that had high degrees of reduction and small cobalt clusters located inside zeolite pores. In the Fischer-Tropsch synthesis these catalysts showed a chain-extension effect, producing hydrocarbons higher than C-10 inappreciable amounts, and an enhanced production of linear hydrocarbons such as 1-olefins and n-paraffins. The formation of long-chain hydrocarbons is attributed to an increased chance of the chain growth owing to a hold-up effect of reaction intermediates, especially 1-olefins, which are accumulated inside zeolite pores during the reaction. Hydrocarbon isomers are produced over acidic sites of zeolite by secondary reactions (isomerization and cracking), which result in a chain shortening of the long-chain hydrocarbons.