In order to enhance dispersion of catalyst for coal hydroliquefaction, an iron-loaded Blind Canyon coal (Fe-BC(K)) was prepared by reducing iron ion with potassium borohydride (KBH4) in the presence of Blind Canyon coal. Hydroliquefaction of Blind Canyon coal (low pyrite content in coal) was carried out with an iron-loaded coal as catalyst in l-methylnaphthalene at 420 degrees C for 60 min under a hydrogen atmosphere (5.0 MPa cold). Iron-loaded coal Fe-BC(K) showed the highest coal conversion and oil yield amounting to 92.0 and 43.9%, respectively, among the catalysts employed in this study. Dispersed iron species on Fe-BC(K) was assigned as alpha-Fe by the X-ray diffraction analysis. Iron dispersed coal, Fe-BC(K) afforded higher coal conversion and oil yield than metallic iron powder prepared by the same method in the absence of coal. The catalytic activity could only be enhanced when the reduction of iron ion was performed in the presence of coal to give highly dispersed iron species. This was proved by X-ray diffraction analyses of line broadening. Effects of catalyst level of iron and reaction time on the product distribution, on the amount of hydrogen transferred, and on the composition of the solvent were examined.