Desorption of hydrogen from palladium-capped SmH3-δ films of 55 nm thickness has been studied using optical measurements. Result show that the thickness of the palladium cap layer affects the deloading of hydrogen from the hydrided films. The direct band gap of the SmH
x
films, calculated from the (αhν)2 vs hν plots, has been found to decrease with increasing thickness of the palladium overlayer, a fact attributed to the enhanced deloading of hydrogen. The removal of hydrogen from these films also leads to the formation of localized states, whose signature is clearly visible in these plots.