The catalytic activity of nanoscale dispersed iron oxyhydroxide catalyst was studied using four coals and several model compounds in a tubing bomb microreactor. Several forms of iron catalyst were examined including the original 3-nm iron oxyhydroxide, H-2 prereduced, and in situ sulfided forms. The addition of catalyst at a 2 wt % coal loading gave an increase in both pentane and tetrahydrofuran solubles for all coals tested. A nonlinear increase in pentane and tetrahydrofuran solubles with an increase in catalyst loading and surface area was observed. The order of liquefaction yields using four solvents was tetralin > methylnaphthalene > mineral oil > creosote oh. Higher temperatures generally gave higher yields of soluble products. Hydrogenation of naphthalene and biphenyl showed that a prereduced form of iron had the greatest activity and allowed the more difficult secondary hydrogenation reactions to occur. CS2 rapidly poisoned the aromatic hydrogenation function of the iron catalyst, although the sulfided catalyst remained active for the hydrocracking of dibenzyl ether.