Hydrogenation of nitrate using supported bimetallic Pd-Cu or Pd-Sn catalysts provides a promising new alternative for denitrification of drinking water with several advantages over established technologies such as reverse osmosis or biological denitrification (Sell et al., 1992). One of the major problems of this technology is the formation of undesired side products, i.e. ammonium and nitrite, both subject to a limiting value far below the admissible nitrate content. Previous studies have shown that the particle size, among other effects, is a key parameter determining the selectivity of the catalyst, pointing to a detrimental effect of pore diffusion limitation (Hahnlein et al., 1998). Moreover, activity and selectivity depend on the concentration of dissolved hydrogen, i.e. high concentration means high activity, but at the same time favoring of ammonium formation due to further hydrogenation. In this paper a porous catalytic membrane acting as a hydrogen diffuser is proposed as a means to solve these problems by creating an efficient three-phase contact between the catalytic surface, dissolved nitrate, and hydrogen gas. Such a design offers the potential to control the activity and selectivity of the process through controlled dosage of hydrogen. Experimental data on the hydrogenation of aqueous nitrate using commercial ceramic membranes modified by insertion of palladium and copper or tin into the pore-structure through impregnation and MOCVD (metalorganic chemical vapor deposition) are presented and discussed together with characterization results obtained by SEM/EDAX and XPS.