German researchers Franz Fischer and Hans Tropsch, working at the Kaiser Wilhelm Institute in the 1920s, developed what is now known as Fischer-Tropsch synthesis or Fischer-Tropsch chemistry for converting a mixture of carbon monoxide and hydrogen (known as synthesis gas or syngas) into a mixture of aliphatic compounds, carbon dioxide, and water. This conversion takes place over a metal-containing catalyst. The aliphatic compounds produced can be considered a synthetic form of petroleum and have been a minor, but historically important source of fuel and lubricant, most notably in World War II-era Germany and in apartheid-era South Africa. This process has received renewed attention in the quest to produce low sulfur diesel fuel in order to minimize the environmental impact from the use of diesel engines.

The utility of the process is primarily in its role in producing fluid hydrocarbons or hydrogen from a solid feedstock, such as coal or solid carbon-containing wastes of various types. Non- oxidative pyrolysis of the solid material produces syngas which can be used directly as a fuel without being taken through Fischer-Tropsch transformations. If liquid petroleum-like fuel, lubricant, or wax is required, the Fischer-Tropsch process can be applied. Finally, if hydrogen production is to be maximized, the water gas shift reaction can be performed, generating only carbon dioxide and hydrogen and leaving no hydrocarbons in the product stream.