While the microstructure of a metal is well-known to affect its equilibrium hydrogen uptake and therefore the hydriding thermodynamics, microstructural effects on the hydriding kinetics are much less documented. Moreover, for thin film systems, such microstructural effects are difficult to separate from the internal stress effect, since most defects generate internal stresses. Such a decoupling has been achieved in this paper for nanocrystalline Pd thin film model systems through the use of a high-resolution, in-situ curvature measurement set-up during Pd deposition, annealing and hydriding. This set-up allowed producing Pd thin films with similar internal stress levels but significantly different microstructures. This was evidenced from detailed defect statistics obtained by transmission electron microscopy, which showed that the densities of grain boundaries, dislocations and twin boundaries have all been lowered by annealing. The same set-up was then used to study the hydriding equilibrium and kinetic behaviour of the resulting films at room temperature. A full quantitative analysis of their hydriding cycles showed that the rate constants of both the adsorption- and absorption-limited kinetic regimes were strongly affected by microstructure. Defect engineering was thereby shown to increase the rate constants for hydrogen adsorption and absorption in Pd by a factor 40 and 30, respectively. Copyright (C) 2015, Hydrogen Energy Publications, LLC. Published by Elsevier Ltd. All rights reserved.