A compact, integral zeolite shell of H-ZSM-5 was directly crystallized on the surface of fused-iron catalyst pellet by a hydrothermal synthesis method. The synthesized catalyst has a core-shell structure without pinholes and cracks. For the reaction of direct synthesis of isoparaffin from syngas, the formation of C10+ hydrocarbons is suppressed completely on this core-shell catalyst, and the middle isoparaffins become the main products. Especially, desirable low methane selectivity is achieved. The core-shell structure of the catalyst provides a tailor-made confined reaction environment with spatially confined effect and shape selectivity, where isoparaffins escaping from outer surface of one core-shell catalyst hardly enter another core-shell catalyst via surface zeolite shell, due to its large steric obstacle, ensuring the elevated isoparaffin selectivity. Furthermore, this type of core-shell catalyst has very high membrane area per unit reactor volume and easy to be prepared, in contrast to the conventional membrane reactor. (C) 2011 Elsevier B.V. All rights reserved.