Atmospheric residual oil hydroprocessing over a dispersed catalyst of cobalt and molybdenum was conducted in continuous mode under 6.9 MPa of Ha using an expanded-bed reactor which was loaded with an appropriate amount of activated carbon granules. As dispersed catalyst precursors, oil-soluble cobalt naphthenate and molybdenum naphthenate were used. Throughout this work, the optimum catalyst composition showing the maximum hydrodesulfurization (HDS) activity was determined, and the possibility of in situ development of a carbon-supported catalyst by the deposition of the oil-dispersed catalysts on the reactor-loaded carbon granules during the reaction was also examined. The co-dispersed Co-Mo catalyst system showed highly selective promotion effects on the hydrotreatment reactions such as HDS, hydrodemetallization and asphaltene conversion. The maximum activity promotion for such hydrotreatment reactions occurred at a Co/(Co + Mo) atomic ratio of 0.3. However, the conversion of heavier to lighter oil fractions, i.e. hydrocracking activity, was highest over Mo alone and decreased with increasing Co content. The expanded-bed reactor was successfully applied to this hydrotreatment system. The reactor-loaded activated carbon played the role of dispersed catalyst immobilizer, contributing to the catalytic reaction performance. Copyright (C) 1996 Elsevier Science Ltd.