In this study, the divergent and magnetic separation method is employed to prepare polyamidoamine (PAMAM) dendrons functionalized magnetic graphene oxide (MGG3) using graphene oxide supported MnFe2O4 nanoparticles as the support (MG), and ethylenediamine (EDA) and methylacrylate (MA) as the precursors of PAMAM dendron. Finally, palladium ions as active catalytic sites are immobilized on the support (MGG3‐Pd). The morphology and structure of the MGG3‐Pd nanocomposite thus produced are characterized by elemental analysis, Fourier transform infrared (FT‐IR), powder X‐ray diffraction (XRD) analysis, thermogravimetric analysis (TGA), field emission scanning electron microscopy (FE‐SEM), transmission electron microscopy (TEM), energy dispersive X‐ray spectroscopy (EDS), inductively coupled plasma atomic emission spectroscopy (ICP‐AES), X‐ray photoelectron spectroscopy (XPS), vibrating sample magnetometer (VSM), and Zeta potential analysis. Subsequently, the catalytic activity of the MGG3‐Pd nanocomposite is studied in the reaction of 4‐nitrophenol (4‐NP) with sodium borohydride as the reducing agent at room temperature. The MGG3‐Pd catalyst is found to exhibit an excellent catalytic activity in the reduction of 4‐NP with a high yield over a short reaction time and at a rate constant (k) of 16.82 × 10−3 s−1. Furthermore, the MGG3‐Pd catalyst thus produced can be recycled at least after 10 runs of 4‐NP reduction without any considerable loss of Pd content. The reduction of other nitroaromatic compounds is also investigated under optimal conditions to illustrate the catalyst's versatility.