The comprehensive analysis of chain mechanism development in the Al-H2O system is performed on the base of novel reaction mechanism taking into account quantum chemistry studies of potential energy surfaces of the elementary reactions with Al-containing species and estimations of rate constants of corresponding reaction channels. As well the physical properties of Al-containing species involved in the reaction mechanism and needed for the calculation of their transport coefficients are reported. The developed reaction mechanism makes it possible to describe with reasonable accuracy the experimental data on ignition temperature in Al-O-2-Ar and Al-H2O systems and obtain the qualitative agreement with measured value of laminar flame speed. The two-stage regime of ignition in the Al-H2O reacting system was revealed both when the aluminum is in the liquid phase and when it comes into steam environment in the gas phase. It was shown that decreasing the ignition temperature one can increase the hydrogen yield in the combustion exhaust. (C) 2013 The Combustion Institute. Published by Elsevier Inc. All rights reserved.