Abstract: Disclosed herein is an outboard motor including a propulsion unit including an internal combustion engine having an exhaust port and an exhaust gas discharge system including a catalytic converter comprising a housing having an outer wall defining an axis, an inlet end with an inlet, and an outlet end with an outlet, a catalytic element located in the housing concentrically with the axis and having an outer surface defining, with the housing outer wall, an outlet volume which increases in size in the direction toward the housing outlet end, an inner surface spaced from the outer surface, defining therein an inlet volume, and defining, adjacent the housing outlet end, a by-pass opening communicating between the inlet volume and the housing outlet, and flow passages extending radially outwardly from the inner surface to the outer surface, communicating, at the inner surface, with the inlet volume, and communicating, at the outer surface, with the outlet volume, and a deflector moveable between a blocking positi