Highly porous, In-filled CoSb3 skutterudite materials with an attractive thermoelectric figure of merit (ZT ~ 1) and corresponding dense samples were fabricated through the cost-effective method of reduction in oxides in dry hydrogen and the pulsed electric current sintering (PECS) method, respectively. The reduction process was described in detail using in situ thermogravimetric analysis of Co2O3, Sb2O3 and In(NO3)3·5H2O separately and in a mixture. Two methods to synthesise the same material were examined: (a) free sintering of an initially reduced powder and (b) PECS. The free-sintered materials with higher porosities (up to ~ 40%) exhibited lower values of electrical conductivity than the dense PECS samples (porosity up to ~ 5%), but the benefit of an even sixfold reduction in thermal conductivity resulted in higher ZT values. The theoretical values of thermal conductivity for various effective media models considering randomly oriented spheroid pores are in good agreement with the experimental thermal conductivity data. The assumed distribution and shape of the pores correlated well with the scanning electron microscope analysis of the microstructure. The lowest value of thermal conductivity, equal to 0.5 W/m K, was measured at 523 K for In0.1Co4Sb12 with 41% porosity. The highest value of ZTmax = 1.0 at 673 K was found for the In0.2Co4Sb12 sample in which the porosity was 36%.Graphic abstract