Sc3N@C80 fullerenes are inserted inside carbon nanotubes (CNTs). The results show that the thermal stability of Sc 3N@C80 fullerenes is around 1200 °C for the fullerenes resting on the wall of CNTs. Internal fullerenes show stability up to 1300 °C, which portrays them as one of most stable types of fullerenes. Electron irradiation of the peapods at 90 kV leads to the formation of capsules inside the CNTs at 5 × 109 e nm-2 electron dosage. This value is an order of magnitude higher than the threshold of electron-induced damage in C60 molecules. Electron energy loss spectroscopy confirms the presence of Sc atoms in capsules. Encapsulation of fullerenes and capsule formation changes the oxidation state of Sc atoms from +2.5 towards +3. This is an evidence of charge transfer between the fullerene/capsule cage and CNT walls. © 2013 The Royal Society of Chemistry.