Carbon nanoballs encapsulated with cobalt were prepared by decomposition of methane. After acid treatment, the encapsulated cobalt can be removed to produce hollow carbon nanoballs. The content of hollow carbon nanoballs as high as 90 vol% in acid-treated carbon product can be obtained by increasing the content of cobalt from 50 to 75 mol% in the catalysts. However, under the same catalytic conditions, the main carbon products are multi walled carbon tubes (MWNTs) over Co/Al2O3, Co/La2O3, Co/CeO2 and Ni/MgO catalysts by decomposition of CH4, or by decomposition of CO over Co/MgO catalysts. These carbon nanoballs encapsulated with cobalt are novel magnetic materials.