A molecular dynamics simulator coupled to a quantum semiempirical Hamiltonian model was applied to multiscale modeling of the catalytic decomposition of hydrocarbons during carbon nanotube (CNT) and carbort nanofiber (CNF) growth. It was found that catalytic decomposition of acetylene is accompanied by a large energy release and its rate weakly depends on temperature in the range from 20 to 700 C. In contrast, the methane decomposition rate substantially decreases as the iron temperature drops. A comparative analysis of acetylene decomposition on a clean surface and on an oxidized Fe(100) surface showed that the presence of oxygen reduces the decomposition rate by an order of magnitude, but has very little influence on the. amount of heat released by the reaction. We also found that oxygen absorbed on the surface of catalyst does not easily diffuse into the catalyst or desorb from the surface. This implies that the surface of the catalyst is quickly covered by oxygen during CNT/CNF growth even at low oxygen flow rates.