A hydrogen generating system which produces hydrogen instantaneously from water ready for use upon demand. The system includes a reactor that has reaction zones wherein catalyst and elevated temperatures generate hydrogen from steam. The zones in the reactor can be in the form of tubes about a heat generating chamber, and the zones are adapted to be interconnected to each other, to atmosphere, and to the source of steam, all to maximize the generation of hydrogen by providing a reactor of optimum flexibility.The present invention also is directed to systems which include the hydrogen generating system and which utilize the generated hydrogen as a fuel or as a chemical.