The surface adsorption effect of CO on the hydrogen permeability of a 12.5 micron-thick Pd77Ag23 membrane has been evaluated quantitatively under experimental conditions close to the operating conditions of the highly-efficient membrane reformer (MRF) system developed by Tokyo Gas. The permeability of the membrane was measured in the conditions of CO concentration between 1 and 5 vol.% at a temperature and pressure of up to 500 °C and 0.6 MPa, respectively. High feed flow rates and a microchannel module configuration were applied in the flux measurements to ensure that the results are obtained with limited influence of concentration polarization adjacent to the membrane surface and hydrogen depletion along the microchannel length. While the CO inhibition effect was close to negligible at 500 °C, it was significant at lower temperatures. At a feed pressure of 0.2 MPa, the CO inhibition effect was only 0.2% at a CO concentration of 1 vol.% and the effect was 3.6% at a CO concentration of 5 vol.% at 500 °C. The CO inhibition effect were 3.4% for 1 vol.% CO and 14.1% for 5 vol.% CO at 400 °C. Measurements were also carried out at a high feed pressure of 0.6 MPa to evaluate the pressure dependence of the CO inhibition effect. The CO inhibition effect decreased to 0.7% at a CO feed concentration of 5 vol.% at 500 °C. Lower CO inhibition effect were also observed at 450 and 400 °C compared to the data obtained with the feed pressure of 0.2 MPa, while the inhibition levels were almost the same at 350 °C. Though the CO inhibition effect is larger at a lower feed pressure of 0.2 MPa, the effect was only 0.2% at 1 vol.% CO at 500 °C, which is close to the operating conditions of the MRF system. This study quantitatively revealed that the CO inhibition effect on hydrogen flux is extremely small when the membrane is operated at temperatures equal to or higher than 500 °C, even for state-of-the-art thin membranes. The performance of the Tokyo Gas MRF seems thus mainly limited by concentration polarization effects.