When H2 and CO2 are exposed to iron at 800-900 K and 1 bar pressure, they react to form H2O, CH4, CO and carbon. The equilibrium water yield, however, is never achieved even after long residence time. Magnetite (Fe3O4) and wustite (FexO), which form during reaction, inhibit carbon deposition. Thus, the "equilibrium" water yield is limited by the iron-iron oxide-gas equilibria. Radical morphological changes in the iron catalyst were observed. At 900 K, a shell-core structure resulted from the oxidation-reduction sequence used in this study. The shell region was shown to be highly porous and consisted of two distinct layers. At 800 K, the structure was again topochemical, however, the shell layer was found to be dense and closely packed. When carbon deposited on the iron catalyst, carbon filaments were observed to form. These destroyed the structural integrity of the catalyst.