A fluidized bed reactor has been developed which uses a two-step thermochemical water splitting process with a peak hydrogen production rate of 47 Ncm3/min.gFe at an oxidation temperature of 850 °C. Of particular interest, is that a mixture of iron and zirconia powder is fluidized during the oxidation reaction using a steam mass flux of 58 g/min-cm2. The zirconia powder serves to virtually eliminate iron powder sintering while maintaining a high reaction rate. The iron/zirconia powder is mixed in a ratio of 1:2 by apparent volume and has a mass ratio of 1:1. Both iron and zirconia particles are sieved to sizes ranging from 125 μm to 355 μm. The efficacy of zirconia as a sintering inhibitor was found to be dependent on the iron and zirconia mean particle size, particle size distribution and iron/zirconia apparent volume ratio. At 650 °C, the oxidation of iron powder with a mean particle size of 100 μm and a wide particle size distribution (40–250 μm) mixed with 44 μm zirconia powder with an iron/zirconia apparent volume ratio of 1:1 results in 75–90% sintering. In all cases, when iron is mixed with zirconia, the hydrogen production rate is not affected when compared with the pure iron case assuming an equivalent mass of iron is in the mixture. When iron powder is mixed with zirconia, both with a narrow particle size distribution (125–355 μm), the first oxidation step results in 3–7% sintering when the reactions are carried out at temperatures ranging between 840 and 895 °C. The hydrogen fractional yield is high (94–97%). For subsequent redox reactions, the macroscopic sintering is totally eliminated at 867 and 895 °C, although the hydrogen fractional yield decreases to 27 and 33%, respectively. It is demonstrated that mixing iron with zirconia in an equivalent mass ratio and similar particle size range can eliminate macroscopic sintering in a fluidized bed reactor at elevated temperatures up to 895 °C.