The oxidation of the Pd(111) surface was studied by in situ XPS during heating and cooling in 0.4 mbar O 2 . The in situ XPS data were complemented by ex situ TPD results. A number of oxygen species and oxidation states of palladium were observed in situ and ex situ. At 430 K, the Pd(111) surface was covered by a 2D oxide and by a supersaturated O ads layer. The supersaturated O ads layer transforms into the Pd 5 O 4 phase upon heating and disappears completely at approximately 470 K. Simultaneously, small clusters of PdO, PdO seeds, are formed. Above 655 K, the bulk PdO phase appears and this phase decomposes completely at 815 K. Decomposition of the bulk oxide is followed by oxygen dissolution in the near-surface region and in the bulk. The oxygen species dissolved in the bulk is more favoured at high temperatures because oxygen cannot accumulate in the near-surface region and diffusion shifts the equilibrium towards the bulk species. The saturation of the bulk "reservoir" with oxygen leads to increasing the uptake of the near-surface region species. Surprisingly, the bulk PdO phase does not form during cooling in 0.4 mbar O 2 , but the Pd 5 O 4 phase appears below 745 K. This is proposed to be due to a kinetic limitation of PdO formation because at high temperature the rate of PdO seed formation is compatible with the rate of decomposition.