A membrane reactor is a reaction system that provides higher productivity and separation cost reduction in chemical reaction processes. In this research, we developed a numerical simulator, taking into account the mass transfer and heat transfer in the axial and radial directions, and analyzed characteristics for temperature distribution and hydrogen permeation in a membrane reactor with Pd-Ag membrane for dehydrogenation of ethylbenzene, with highly endothermic reaction heat. The simulation results exhibited that the temperature distribution in the reactor has considerably changed in the axial and radial directions, and the hydrogen permeability through the membrane has varied from position to position in the reactor. In membrane reactor analysis for the reaction with highly reaction heat, consideration of the temperature gradient in the reactor is believed to lead to the precise estimation of performance characteristics of the membrane reactor. Furthermore, on the basis of the analyzed results, some knowledge for the effects of the tube radius, sweep gas rate, operating pressure of reaction and thickness of membrane on the performance of the membrane reactor, was accumulated to design a membrane reactor system.