The effect of supercritical water (SCW) on the hydroconversion of Tahe residue has been investigated at different temperatures and hydrogen pressures. It was demonstrated that introduction of water into the reaction could reduce the amount of coke formed and increased the yield of liquid product. The isotopic tracer method was used to determine quantitatively the extent of hydrogen exchange between water and the liquid product. The results indicated that the degree of hydrogen exchange of the liquid product with water decreased slightly with increasing hydrogen pressure. About 40% of the water molecules involved in hydrogen exchange with the oil residue as the concentration of water in the reaction mixture was 10 wt %. (C) 2010 American Institute of Chemical Engineers AIChE J, 56: 3236-3242, 2010