A circulating fluid bed combustion (CFBC) unit, which burns a carbon and nitrogen containing fuel to produce heat and flue gas comprising NO.sub.x, operates with reduced emissions of NO.sub.x from the flue gas by adding to the circulating fluid bed a catalytically effective amount of a DeNO.sub.x catalyst, such as bismuth oxide on a silica/alumina support. The DeNO.sub.x catalyst may circulate freely with the circulating inventory of particulates in the CFB, or can be disposed on a heavier particle which "slips" and has an extended residence time in the combustion zone where the carbonaceous fuel is burned. A CO combustion promoter, such as Pt on silica/alumina may also be present.