In the present paper, we report the importance of controlling the heat-treatment temperature, the factor that determines the fine structure (core-shell structure or alloy-phase structure) of PdCo bimetallic electrocatalysts. The dependence of the oxygen reduction reaction (ORR) activity of bimetallic PdxCo100-x nanoparticles on the various heat-treatment conditions employed in the preparation process has been investigated. Precise Rietveld refinements of high-resolution powder diffraction data and the fine structure parameters simulated using the extended X-ray absorption fine structure data reveal the following. At a heat-treatment temperature of 300 degrees C, a phase-segregated PdCo core-shell structure (Pd shell on a Co core) is formed, while at higher temperatures (above 500 degrees C), a PdCo alloy phase is formed and the core-shell structure is destroyed. The samples for which the core-shell structure had a high-compressive strain lattice structure with a Pd-rich phase caused a downshift of the d-band center, and eventually, the ORR activity of these samples was better than that of the alloy-phase samples formed by high-temperature heat treatment. Hence, the heat-treatment temperature is the most important factor to be considered in the design of PdCo alloy electrocatalysts. (c) 2012 Elsevier Inc. All rights reserved.