A microreactor consisting of two parallel channels is numerically simulated where methanol steam reforming takes place in one channel, and the required heat is supplied by methanol oxidation in the other channel. Effects of different parameters on methanol conversion, hydrogen yield and CO concentration are examined. Results from the parametric study are then used to propose conditions for high methanol conversion and hydrogen yield. A microreactor with enhanced output conditions is thus designed which is capable of producing a gas stream consisting of 74% hydrogen (dry). CO concentration in the generated synthesis gas stream is low enough to require only a PROX reactor for CO clean-up, eliminating the need for a bulky water gas shift reactor. The produced hydrogen from an assembly of such microreactors can feed a low-power PEM fuel cell. A cluster of these microreactors would take a volume of about 91 cm(3) to feed a typical 30-watt PEM fuel cell. Copyright (C) 2011, Hydrogen Energy Publications, LLC. Published by Elsevier Ltd. All rights reserved.