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A novel palladium-based micromembrane is reported that can be used for hydrogen gas separation in a miniature fuel processor for micro fuel cells. The micromembrane structure is built in a silicon substrate, using standard MEMS microfabrication processes. Four layers, viz. copper, aluminum, spin-on-glass (SOG) and palladium form the composite membrane. Copper, aluminum and SOG layers provide structural support for the palladium film. Copper can act as catalyst in the water gas shift reaction that converts unwanted carbon monoxide gas into hydrogen. Palladium is used to separate hydrogen from other gases present. The micromembrane selectively separates hydrogen from a 20:80 hydrogen:argon gas mixture by weight even at room temperature. The diffusion of hydrogen through palladium is enhanced at higher temperatures and pressures, closely following the predictions from Sievert's law. Future applications of this micromembrane for simultaneous water gas shift reaction and hydrogen separation are discussed.