Supported micron-sized molybdenum disulfide (MoS2) has been extensively studied for catalytic synthesis of Higher Alcohols Synthesis (HAS) from synthesis gas (syngas). However, the process is associated with low space-time-yield (STY) and poor selectivity under high temperature (300-325 degrees C) and high pressure (10-20 MPa) operation, making it unattractive for commercial application. Nano-sized MoS2 catalyst particles improve selectivity to alcohols but the yields are low possibly due to catalyst aggregation and mass transfer limitations. This study describes the use of oil-in-polyethylene glycol (PEG) microemulsion-based encapsulation of hydrophobic catalyst nanoparticles (MoS2) to prevent aggregation, increase surface area and increase mass transfer across the two phases. In this study, nano-sized MoS2 was first synthesized by sonolysis of hexacarbonyl molybdenum and yellow sulfur in hexadecane in <90% yield, mixed with non-ionic surfactant (Tergitol NP-8) and the mixture was slurried in two solvents: PEG-400 or Ethylflo-164 (a C30 oil). The slurred nano MoS2 was evaluated for syngas (H-2/CO = 2:1) conversion into higher alcohols in a 300 mL stirred batch reactor. Our results showed increased STY, reaching 1.2 kg alcohols/kg catalyst/h. The corresponding product selectivity reached 62 wt% methanol and 52 wt% to ethanol, respectively in two separate runs when microemulsion-based catalysts were employed. These results open up the possibility of a novel and efficient route to higher alcohols. (C) 2015 Published by Elsevier Ltd.