Conducting catalytic methane decomposition over Fe catalysts is a green and economic route to produce H2 without CO/CO2 contamination. Fused 65wt% and impregnated 20wt% Fe catalysts were synthesized with different additives to investigate their activity, whereas showing Fe-Al2O3 combination as the best catalyst. Al2O3 is speculated to expose more Fe00 for the selective deposition of carbon nano tubes (CNTs). A fused Fe (65wt%)-Al2O3 sample was further investigated by means of H2-TPR, in-situ XRD, HRTEM and XAS to conclude 750°C is the optimized temperature for H2 pre-reduction and reaction to obtain a high activity. Based on density functional theory (DFT) study, a reaction mechanism over Fe catalysts was proposed to explain the formation of graphite from unstable supersaturated iron carbides decomposition. A carbon deposition model was further proposed which explains the formation of different carbon nano materials.