The present study was undertaken to understand the fundamentals of recycling the tail gas during the Fischer-Tropsch Synthesis with an iron-based catalyst with particular emphasis on the importance of the usage ratio. The usage ratio was ca. 1.4 for the catalyst studied at our reaction conditions (240 degrees C, 20 bar, 5000 mL/ (g(cat).h)). The study shows the H-2/CO ratio in the recycle gas fed to the reactor depends on both the H-2/CO ratio in the fresh feed and the usage ratio of the catalyst. For an H-2/CO in the fresh feed higher than the 1.4, the H-2/CO ratio in the reactor increases with the increasing recycle ratio whereas the converse is true for H-2/CO ratios lower than 1.4. For negligible change in the Fischer-Tropsch selectivity during external recycle, the H-2/CO ratio in the fresh feed should match the usage ratio of the catalyst. The presence CO2 in this recycled gas did not change the overall CO2 selectivity; hence, CO2 is regarded as an inert at these conditions.