Hollow chitosan fibers were reacted with chloropalladate solutions and subsequently reduced by hydrogen produced in situ by reaction of sulfuric acid with zinc powder in order to manufacture palladium supported on catalytic hollow chitosan fibers (C2HF-Pd). This catalytic support was used to degrade 3-nitrophenol (3-NP) using two different hydrogen donors (hydrogen gas and sodium formate). The solution was flowed through the lumen of the fiber, while the sodium formate was recirculated round the outside of the fiber. In the case of hydrogen gas, the gas was maintained under controlled pressure outside the fiber. The influence of the pH, residence time (ca. flow velocity), nitrophenol concentration, and hydrogen-donor concentration (or pressure) was investigated for both systems in order to evaluate the limiting parameters. While the system using sodium formate was the most efficient for nitrophenol conversion, the system using hydrogen gas avoided the production of secondary waste solutions (formate solutions with traces of nitrophenol, which pass through the fiber membrane).