An alumina supported nickel aerogel catalyst was prepared by the sol-gel method and used in the catalytic decomposition of methane. An in situ thermal balance reactor was employed in the study of the reaction. A number of catalysts prepared by the same procedure with different nickel to aluminum ratio were tested. It has been observed that the catalyst oxide precursor has a NiAl2O4-like structure. The amount of the carbon nanotubes (CNTs) formed before the deactivation of the catalyst increases with the nickel content in the catalyst. CNTs grow in 450-700 degreesC. TEM micrographs show that the CNTs are curved, with diameters in the range of 10-20 nm. Both the reaction and catalyst reduction conditions have strong influences on the morphology of the CNTs and on the reaction behavior.