Metal nanoparticles stabilized by crystalline metal−organic frameworks (MOFs) are highly promising for green heterogeneous catalysis. In this work, in situ formed ultrafine Pd nanocatalysts with an average size of 3.14 nm have been successfully immobilized into the mesopores or defects of a water-stable indium-based MOF by the double-solvent method and subsequent reduction. Significantly, the obtained Pd@InOF-1 displays an obvious and satisfactory size-selective effect in the Suzuki−Miyaura coupling reaction between arylboronic acids and aryl bromides. On the basis of the synergistic effect, microporous InOF-1 nanorods afford a confined space for improving the selectivity of target products while Pd nanoparticles endow abundant active sites for catalysis. Herein, choosing the smallest size reactant with only one benzene ring gives the highest isolated yield of 90%, and if the size is larger, the yield is obviously reduced or even the target product could not be collected. Looking forward, this demonstrated study not only assembles a well-designed Pd@MOF composite with unique micro-nanostructures but also delivers an impressive option for cross-coupling reaction, which has implications for the further development of MOF hybrids for sustainable applications.