A comprehensive simulation of the diimide hydrogenation process is carried out by taking into account the diimide generation reaction, the hydrogenation reaction, the side reaction between hydrogen peroxide and diimide, the disproportionation of diimide, and the diimide diffusion process. The relative magnitude of these rate constants with the diffusivity of diimide is estimated. It is found that the diimide diffusion interferes with the diimide hydrogenation of the latex of nitrile butadiene rubber (NBR), even though the particle diameter is as small as 72 nm. The interference of diimide diffusion makes it very difficult to achieve above 90% of hydrogenation without significant gel formation. Using core-shell latex with an NBR shell may help to solve the low hydrogenation efficiency and the gel formation at the same time.