Ever since a minimum in the electrical resistance (R) at a characteristic temperature in noble metals containing 3d magnetic impurities was reported several decades ago, the consequences of this phenomenon, known as the Kondo effect, in metallic solids remains an active area of research. In concentrated Kondo alloys of Ce, Sm, Yb or U [1], if the strength of the intersite indirect exchange interaction (given by T RKKY ) is comparable to that of the Kondo effect (given by the Kondo temperature, T K ), one also observes magnetic ordering well below the temperature at which resistivity shows a minimum. However, such a feature in R is not expected for Gd alloys, since the Gd-4f orbital is so well localized that it cannot exhibit the Kondo effect. In this article, we report the observation of a pronounced minimum in the plot of R versus temperature (T) well above the magnetic ordering temperature in a Gd based intermetallic compound, Gd 2 PdSi 3 (which is presumably antiferromagnetic [2], T N = 21 K), resembling the behaviour in magnetic Kondo lattices. This finding implies that a minimum in R(T) can also occur from a completely different mechanism as a magnetic precursor effect, which, we believe, is an exchange interaction induced electron localization.The polycrystalline sample, Gd 2 PdSi 3 , was prepared by arc melting followed by homogenization at 750 o C in an evacuated sealed quartz tube. We have also investigated alloys with Gd substituted by Y, i.e., (Gd 1−x Y x ) 2 PdSi 3 (x= 0.2, 0.5 and 0.8). The x-ray powder diffraction patterns (Cu K α ) confirm that these alloys are single phase forming the hexagonal AlB 2 -type structure [2]. The homogeneity of the samples were checked by scanning electron microscopy. The electrical resistance measurements (4.2 -300 K) were performed by a conventional four-probe method. Additional experiments carried out to support the line of our arguments and conclusions are: (i) The magnetoresistance measurements in the longitudinal geometry in a magnetic field (H) of 50 kOe as a function of T and as a function of H at selected temperatures for the x= 0.0 alloy; (ii) 155 Gd (5/2 → 3/2, 86.5 keV transition) Mössbauer measurements in the transmission geometry with a 2 mCi 155 Eu(SmPd 3 ) source for x= 0.0 alloy below 25 K at selected temperatures; (iii) Heat-capacity (C) measurements as a function of temperature (2 -70 K); (iv) Magnetic susceptibility (χ) measurements (2 -300 K) in a field of 100 Oe and in 2 kOe.The temperature dependence of the normalized electrical resistivity below 200 K is plotted in figure 1 for all compositions investigated. The values of ρ at 300 K and 4.2 K for Gd 2 PdSi 3 are of the order of 400 and 280 µΩ cm respectively. Due to the presence of microcracks in the sample, the error of these values might be smaller by about 40%. For this reason, the data shown in Fig. 1 are normalized to the values at 300 K. It is obvious from Fig. 1 that the ρ(T) of the Gd 2 PdSi 3 compound gradually decreases as the temperature is lowered down to 60 K, followed by an upturn ...