The mechanisms involved in the formation/dissociation of methane hydrate confined at the nanometer scale are unraveled using advanced molecular modeling techniques combined with a mesoscale thermodynamic approach. Using atom-scale simulations probing coexistence upon confinement and free energy calculations, phase stability of confined methane hydrate is shown to be restricted to a narrower temperature and pressure domain than its bulk counterpart. The melting point depression at a given pressure, which is consistent with available experimental data, is shown to be quantitatively described using the Gibbs–Thomson formalism if used with accurate estimates for the pore/liquid and pore/hydrate interfacial tensions. The metastability barrier upon hydrate formation and dissociation is found to decrease upon confinement, therefore providing a molecular-scale picture for the faster kinetics observed in experiments on confined gas hydrates. By considering different formation mechanisms—bulk homogeneous nucleation, external surface nucleation, and confined nucleation within the porosity—we identify a cross-over in the nucleation process; the critical nucleus formed in the pore corresponds either to a hemispherical cap or to a bridge nucleus depending on temperature, contact angle, and pore size. Using the classical nucleation theory, for both mechanisms, the typical induction time is shown to scale with the pore volume to surface ratio and hence the pore size. These findings for the critical nucleus and nucleation rate associated with such complex transitions provide a means to rationalize and predict methane hydrate formation in any porous media from simple thermodynamic data.