A two phase catalyst is disclosed with one or more transition metals such as Cu, Co, Fe, Ag and Mo supported on a molecular sieve having a pore size not greater than 8 .ANG. along with a stabilizing oxide of one or more of the oxides of Zr, Mo, V, Nb or the rare earths coating the molecular sieve. A method of preparing the two phase catalyst and using same to remediate NO.sub.x in combustion gases is also described.