In this research, the effect of steam on synthetic fuel production from sawdust in new-designed dual-bed gasification was studied. The dual-bed gasification reactor composed of bubbling/fast fluidized bed combustor and fixed bed gasifier (pyrolysis included) was designed to produce syngas (CO + H2 + CO2 and CH4). The results showed that syngas produced by the dual-bed gasifier with higher steam/carbon ratio also had higher H2 content. In theory, the various reactions expected to occur in the gasification process were boudouard, water-gas and water-gas shift, methanation and steam reforming. Since the operating temperature was only 500-600°C that the steam reformation of methane was desperately to occur due to its endothermic, then CH4 formation still were found. Producer gas from the new gasifier had relatively high quality in terms of heating value per a unit volume compared to other conventional gasifiers. This can be used directly as good gaseous fuel. However, the product gas was not likely served as precursor in chemical industries due to its still low H2/CO ratio and high CH4 concentration.