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 In_0.1Co₄Sb₁₂ with 41% porosity. The highest value of ZT_max = 1.0 at 673 K was found for the In_0.2Co₄Sb₁₂ sample in which the porosity was 36%. Graphic