The European Green Deal has set a target for Europe to achieve net-zero greenhouse gas emissions by 2050, necessitating a transition to more sustainable energy sources. Hydrogen gas (H2) has emerged as a promising solution, with methane pyrolysis presenting a viable method for its production. This study explores the optimization of methane plasma pyrolysis for hydrogen and high-quality carbon production. Employing a statistical approach by a design of experiment software, critical process parameters are systematically analyzed to predict their impact within a defined range. Additionally, the paper conducts comprehensive characterization of the solid carbon produced during pyrolysis using imaging, spectroscopic and elemental analysis, and gas sorption analysis methods. The experimental investigation was conducted using a thermal plasma reactor with several settings of influential parameters including methane gas (CH4) content in the plasma gas, electric current, and arc length. The DC-transferred plasma arc is formed using a variable gas mixture of argon gas (Ar) and CH4, with a constant flow rate of 5 Nl/min. Thirteen tests were designed, evaluating responses such as power input, process stability, and H2 yield. The H2 yield indicates the hydrogen produced from CH4, with 100% representing total conversion. While the process exhibited inconstancy, attributed to reactor design constraints, a high H2 yield of 67%–100% was achieved. The results indicate that a higher CH4 content in the plasma gas and extended arc lengths disturb the plasma arc, hence reducing the H2 yield. Increased power input, achieved through higher amperage levels, and a wider reaction zone eased by extending the arc length both led to an improved H2 yield. Scanning electron microscopy (SEM) and energy dispersive X-ray spectroscopy (EDS) revealed microstructural differences, with carbon samples from the filter exhibiting finer textures and carbon samples from the reactor larger sizes and dendritic particles. Raman spectroscopy confirmed crystalline graphitic-like structures with low defect concentrations, a finding supported by X-ray diffraction (XRD) analysis. Inductively coupled plasma mass spectroscopy (ICP-MS) analysis confirmed high-purity carbon with slight impurities from initial filter contamination. Brunauer-Emmett-Teller (BET) specific surface area calculations based on gas sorption analysis showed significant variations, with filter-collected samples exhibiting 40–170 m2/g and reactor-collected ones showing 7–30 m2/g.