The incorporation of catalysts to enhance downhole upgrading in the Toe-to-Heel Air Injection (THAI) process is limited by deactivation due to coking arising from the cracking of heavy oil. This study aims to reduce the catalyst deactivation problems that can occur with upgrading of heavy oils. Ultradispersed catalyst particles could potentially replace pelleted catalysts which may be difficult to regenerate once deactivated during the THAI operation. The dispersed particles could potentially be applied once through, down-hole for in situ upgrading of heavy oil. The catalyst studied was finely crushed pelleted Ni-Mo/Al 2 O 3 catalyst (2.4 μm). The product distribution of liquid, coke and gas may be influenced by the presence of a suitable hydrogen source which promotes hydroconversion reactions rather than simple cracking. In order to improve liquid yield whilst suppressing coke formation, the effect of cyclohexane as hydrogen-donor solvent was studied in a stirred batch reactor (100 mL) at temperature 425°C, initial pressure 17.5 bar, agitation 500 rpm, and a short reaction time of 10 min. The use of cyclohexane was evaluated against that of hydrogen gas. The reaction under hydrogen atmosphere significantly reduced coke yield by 41.3% compared with a nitrogen environment under the same conditions. Also, the coke decreased by 6.2-45.4% as the cyclohexane:oil ratio increased from 0.01 to 0.08 (g·g −1 ) relative to 4.67 wt.% of coke observed without added cyclohexane in ultradispersed catalytic upgrading under nitrogen environment. As the cyclohexane:oil ratio increases, the produced oil API gravity and middle distillate fractions (200-343°C) increase whilst the viscosity decreases. An estimated 0.073 CH:oil ratio was found to suppress coke formation in a similar manner to upgrading under hydrogen atmosphere at the same conditions.