In this study, ultradispersed colloidal particles of iron oxide/hydroxide were prepared in-situ in heavy oil matrices adopting (w/o) microemulsion approach for nanoparticle preparation detailed in our previous work [1-3]. The effect of composition of heavy oil on the stable concentration of colloidal particles, particle uptake, was investigated. The following trends in particle uptake were common between the (w/o) microemulsions and the heavy oil matrices. An optimum water content was found for which a maximum particle uptake was attained. Particle uptake increased as the content of vacuum residue, VR, and precursor salt concentration increased. Vacuum residue contributes high asphaltene content, which acts as a surface active agent. The iron oxide/hydroxide particles had been recently shown to effectively remove H2S(g) from oil phase [4]. H2S(g) is a hazardous by-product of heavy oil recovering and upgrading which should be removed as soon as it forms. Results pertaining to H2S(g) removal from heavy oil employing ultradispersed particles are communicated in Part II of this study. (C) 2009 Elsevier B.V. All rights reserved.