The problem of obtaining exact information on the particle size dependence of the rate of gold-catalysed reactions is surveyed, and it is shown to be possible that over a range of mean sizes the activity for CO oxidation is predominantly due to the fraction of particles smaller than about 2.5 nm. This size coincides with the point at which transition from metallic to non-metallic or ‘molecular’ behaviour is expected, and means of describing the electronic structure of the microparticles is considered. This transition may be the cause of enhanced and activated chemisorption of the CO molecule. Analysis of results for the rate dependence on size for CO oxidation on Au/TiO₂ catalysts by the compensation relation confirms the importance of the transition. It is also held responsible for the ability of the PtAu system to form small homogeneous alloy particles.