A simulation of a membrane reactor for the water gas shift reaction is carried out by means of a 1D pseudo-homogeneous nonisothermal mathematical model. The composite membrane consists of a dense layer of Pd (selective to H-2) supported over a porous ceramic layer. The effect of temperature, overall heat-transfer coefficient, and mode of operation on the membrane reactor performance and stability are analyzed, and the results obtained are compared with those corresponding to a reactor with no hydrogen permeation. (C) 2009 American Institute of Chemical Engineers AIChE J, 55: 3206-3213, 2009