Novel palladium‐doped nanoparticles have been explored to serve as the first metal oxide‐derived heterogeneous catalyst for Ullmann reaction of chloroarenes under mild condition (34 °C). This heterogeneous catalyst exhibited high catalytic activity towards the Ullmann homocoupling of chloroarenes into a series of useful symmetrically biaryl products with good to excellent yields in the presence of ethanol and NaOH, thereby leading to green and economical Ullmann reaction. The produced nanoparticles were successfully characterized by various techniques including PXRD, XPS, HRTEM, SEM‐EDS, BET, TGA techniques, elemental mapping analysis and ICP‐OES. Interestingly, based on characterization and experimental data, a reasonable mechanism has been proposed. Also, the formation of aryl methyl ketone as a by‐product has been further confirmed by isotopic labelling experiments that the acetyl moiety is derived from ethanol. Moreover, the catalyst was stable and could be easily reused up to 5 times under atmospheric air without suffering significant loss in catalytic activity.