Studying the dynamic evolution of the reaction process that identifies the key intermediate is important for elaborating the reaction mechanism, but it is still challenging from the point of view of the experiment. Methane oxidation over Pd-based catalysts including Pd (111) with different oxygen coverages and PdO ( 101) is studied by reactive force field molecular dynamic simulations in this work to explore the dynamic character of oxygen species like chemisorbed oxygen and lattice oxygen on the C−H bond activation and the C−O bond formation. The results show that methane oxidation on the Pd (111) surfaces is initiated by the direct dissociation of methane molecules (CH 4 → CH 3 + H) rather than the oxygen-assisted dissociation (CH 4 + O → CH 3 + OH), which is in agreement with the first-principle electronic structure calculation results. A comparison of methane oxidation at different oxygen coverages shows that the catalytic activity increases with the increase of oxygen pressure in general: There is no CO at low oxygen coverage and CO is formed at higher oxygen coverage up to 3/9 ML, but no CO 2 is formed. This is because the C−O bond formation barrier is higher than the H− O bond formation barrier. Therefore, it is in favor of the formation of OH species instead of the CO 2 formation for methane oxidation on metallic Pd. On the PdO (101) surface, we notice that the lattice oxygen species are more active compared to the chemisorbed oxygen species in both the activation of methane and the oxidation of CH x species due to its strong hydrogen affinity and high electron density, leading to high methane oxidation activity and ultimately CO 2 formation. Importantly, a novel path for the CO 2 formation via a dioxymethylene (H 2 COO) intermediate (CH 2 O + O → H 2 COO) or a hydroxymethoxy (H 2 COOH) intermediate (CH 2 O + OH → H 2 COOH) has been identified from our present reactive force field molecular dynamic simulations, which is generally ignored in the static electronic structure scheme like density functional theory. It is hoped that the present results would be a guide for the rational design of the methane oxidation catalysts by controlling the active phase of Pd (or Pt) or provide more essential knowledge for a better understanding of the methane oxidation or methane reformation reaction mechanism.