The formation of Pd0.05Ce0.95O2 catalysts for the low-temperature oxidation of CO by the thermal decomposition of Ce(NO3)(3) and Pd(NO3)(2) with oxygen was studied by X-ray photoelectron spectroscopy (XPS) and X-ray absorption spectroscopy (XAS) directly in the preparation chamber of a spectrometer. Palladium is represented by two species on the surface of the catalysts: solid solutions of PdxCe1-xO2-delta and palladium clusters. Pd clusters can be formed in an oxidized or reduced state depending on the reaction conditions. Treatment of the catalysts with hydrogen leads to a sharp increase in CO conversion because of the reduction of parts of the palladium accompanying the formation of the metallic clusters. The testing of "real" and model catalysts was conducted in a light-off mode. The correlation between the activity of the Pd/CeO2 catalysts and the states of the palladium was proposed. (C) 2012 Elsevier B.V. All rights reserved.