Sulfated-zirconia catalysts show rapid deactivation (deactivation constants near 0.02 min(-1)) during isomerization of n-butane when olefins are present in the feed. Removal of olefins from the feed decreases the rate of catalyst deactivation over sulfated-zirconia (to values near 0.007 min(-1)). The rates of deactivation are slower during isobutane isomerization (deactivation constants near 0.003 min(-1)) than during n-butane isomerization over sulfated-zirconia catalysts in the presence of feed olefins. Deactivation of the catalysts during n-butane isomerization appears to be caused by the production of coke on the catalyst from straight-chain olefinic species either present in the feed or produced on the catalyst under reaction conditions. Butane isomerization over sulfated-zirconia can be viewed as being a surface chain reaction comprising initiation, propagation, and termination steps. The primary initiation step in the absence of feed olefins is the dehydrogenation of butane over sulfated-zirconia, generating butenes which adsorb onto acid sites. Quantum-chemical calculations, employing density functional theory, suggest that the dissociative adsorption of dihydrogen, isobutylene hydrogenation, and dissociative adsorption of isobutane are feasible over the sulfated-zirconia cluster, and these reactions take place over the Zr-O sites.