Catalytic conversion of NO in the presence of H 2 and O 2 has been studied on Pd(111) surfaces, by using a molecular beam instrument with mass spectrometry detection, as a function of temperature and reactants composition. N 2 and H 2 O are the major products observed, along with NH 3 and N 2 O minor products under all conditions studied. Particular attention has been paid to the influence of O 2 addition toward NO dissociation. Although O 2rich compositions were found to inhibit the deNO x activity of the Pd catalyst, some enhancement in NO reduction to N 2 was also observed up to a certain O 2 content. The reason for this behavior was determined to be the effective consumption of the H 2 in the mixture by the added O 2 and O atoms from NO dissociation. NO was proven to compete favorably against O 2 for the consumption of H 2 , especially ≤550 K, to produce N 2 and H 2 O. Compared with other elementary reaction steps, a slow decay observed with the 2H + O → H 2 O step under SS beam oscillation conditions demonstrates its contribution to the rate-limiting nature of the overall reaction. Pd(111) surfaces modified with O atoms in the subsurface (Md-Pd( 111)) induces steady-state NO reduction at near-ambient temperatures (325 K) and opens up a possibility to achieve room temperature emission control. A 50% increase in the reaction rates was observed at the reaction maximum on Md-Pd(111), as compared with virgin surfaces. Oxygen adsorption is severely limited below 400 K, and effective NO + H 2 reaction occurs on Md-Pd(111) surfaces. Valence band photoemission with a UV light source (He I) under different oxygen pressures with APPES clearly identified the characteristics of the Md-Pd(111) surfaces and PdO. The electron-deficient or cationic nature of Md-Pd(111) surfaces enhances the NO dissociation and inhibits oxygen chemisorption ≤400 K under lean-burn conditions.