The effect of thermal treatment of aluminum core-shell particles on their oxidation kinetics in water for hydrogen production was investigated. The samples were obtained by dividing dried aluminum powder, partially oxidized by distilled water, into eight portions, which were thermally treated at temperatures of 120, 200, 300, 400, 450, 500, 550 and 600 °C. Alumina shell cracking at 500–600 °C enhances hydrogen generation due to uncovering of the aluminum cores, while sharp thickening of the protective oxide film on the uncovered aluminum surfaces at 550–600 °C significantly reduces reactivity of the core-shell particles. For these reasons, after reaction with distilled water at 90 °C for two hours, the highest hydrogen yield (11.59 ± 1.20)% was obtained for the sample thermally treated at 500 °C , while the yield for aluminum core-shell powder without heat treatment was only (5.46 ± 0.13)%. Another set of experiments employed multiple consecutive cycles of alternating oxidation by water and thermal treatment at 500 °C of the same powder sample. As predicted, the hydrogen yield gradually decreased with each subsequent experiment. The series of six cycles resulted in a total hydrogen yield of 53.46%.