Combustion characteristics, flame location and thermal performance of premixed hydrogen-air combustion in two combustors with different outer diameters (OD = 4 mm and OD = 5 mm) are investigated and compared. In order to enhance the flame stabilization and improve the efficiency, the micro combustors are presented with two rearward-steps and various inlet shapes. Verified with experimental tests, a three-dimensional numerical model has been employed to assess the flame location, OH radical and gas temperature distributions. It is observed that the flame location and thermal performance are significantly affected by the structure of the micro combustor. The results indicate that a properly stepped/flared inlet section contributes to the ignition and enhances the preheating of the unburned reactants. The heat recirculation zone behind the rearward-step provides a suitable location for the flame anchoring. In addition, a high and uniform outer wall temperature distribution is beneficial for the efficiency improvement and system application. The combustor with a small size obtains a higher wall temperature and is more sensitive to the change of combustion chamber. However, the combustors with OD = 5 mm gains the better flame stability and working performance with a higher power output, radiation efficiency and system efficiency at a higher mass flow rate. Moreover, the power output and system efficiency of the combustor with two rearward-steps are 2 times higher than that with one step.