Abstract Hydrogen is considered as the most potential energy carrier in the near future and may be produced from fusion nuclear energy by several means, such as water electrolysis, steam reforming reaction and thermochemical water-splitting process, etc. The capability of fusion energy can be improved by the development of high performance blanket. In this paper, a novel high temperature PbLi blanket concept based on reduced activation ferritic/martensitic (RAFM) steel as structural material with multilayer flow channel inserts (MFCI) technology has been proposed and evaluated for hydrogen production. The conceptual design, performance analyses are given for this novel blanket. R&D needs are specified, such as tritium permeation and chemical compatibility under high temperature and under irradiation, and key technology development to avoid inter-contamination issues between hydrogen production system and fusion reactor.