The floating catalyst chemical vapour deposition (FC-CVD) method is unique in providing the capability for continuous carbon nanotube (CNT) synthesis at an industrial scale from a one-step continuous gas-phase process. Controlling the formation of the iron-based catalyst nanoparticles is widely recognized as a primary parameter in optimizing both CNT product properties and production rate. Herein the combined influences of pyrolytic carbon species and catalytic nanoparticles are both shown to influence CNT aerogel formation. This work studies the source of carbon in the formed CNTs, the location of aerogel formation, the in-situ behaviour of catalyst nanoparticles and the correlated morphology of the resultant CNTs. Axial measurements using isotopically-labelled methane (CH4) demonstrate that carbon within all CNTs is primarily derived from CH4 rather than some of the early-forming CNTs being predominantly supplied with carbon via thermal decomposition of catalytic precursor components. Quantification of CNT production along the axis of the reactor definitively dispels the notion that injection parameters influence CNT formation and instead shows that bulk CNT formation occurs near the reactor exit regardless of the carbon source (CH4, toluene or ethanol). Supply of carbon to different reactor locations indicates that CNT aerogel formation will occur even when carbon is delivered near the exit of the reactor so long as the carbon source reaches a sufficient temperature (>1000 °C) to induce pyrolysis. These results give an indication of how future large-scale CNT reactors may be optimized and controlled by modifying downstream catalyst and carbon delivery.