During the nitrogen-fixing process, ammonia ($NH_3$) is incorporated into glutamate to yield glutamine and is generally not secreted. However, in this study, $NH_3$-excreting strains of nitrogen-fixing Paenibacillus were isolated from soil. The ammonium production by the Paenibacillus strains was assayed in different experiments (dry biomass, wet biomass, cell-free extract, and cell-free extract adsorbed on nano $TiO_2$ particles) inside an innovative bioreactor containing capsules of $N_2$ and $H_2$. In addition, the effects of different $N_2$ and $H_2$ treatments on the formation of $NH_3$ were assayed. The results showed that the dry biomass of the strains produced the most $NH_3$. The dry biomass of the Paenibacillus strain E produced the most $NH_3$ at 1.50, 0.34, and 0.27 ${mu}M$ $NH_3$/mg biomass/h in the presence of $N_2$ + $H_2$, $N_2$, and $H_2$, respectively, indicating that a combined effluent of $N_2$ and $H_2$ was vital for $NH_3$ production. Notwithstanding, a cell-free extract (CFE) adsorbed on nano $TiO_2$ particles produced the most $NH_3$ and preserved the enzyme activities for a longer period of time, where the $NH_3$ production was 2.45 ${mu}M$/mg CFE/h over 17 h. Therefore, the present study provides a new, simple, and inexpensive method of $NH_3$ production.