The novel application of a catalytic water‐gas‐shift membrane reactor for selective removal of CO from H2‐rich reformate mixtures for achieving gas purification solely via manipulation of reaction and diffusion phenomena, assuming Knudsen diffusion regime and the absence of hydrogen permselective materials, is described. An isothermal, two‐dimensional model is developed to describe a tube‐and‐shell membrane reactor supplied with a typical reformate mixture (9% CO, 3% CO2, 28% H2, and 15% H2O) to the retentate volume and steam supplied to the permeate volume such that the overall H2O:CO ratio within the system is 9:1. Simulations indicate that apparent CO:H2 selectivities of 90:1 to >200:1 at H2 recoveries of 20% to upwards of 40% may be achieved through appropriate design of the catalytic membrane and selection of operating conditions. Under these conditions, simulations predict an apparent hydrogen permeability of 2.3 × 10−10 mol m−1 Pa, which compares favorably against that of competing hydrogen‐permselective membranes. © 2013 American Institute of Chemical Engineers AIChE J, 59: 4334–4345, 2013